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Earlier today, Automatic Data Processing (ADP) released a report indicating that the economy gained a total of 55,000 private sector jobs in May. That number fell short of expectations. Most economists predicted an increase of 60,000 new private sector jobs for the month.
May marks the fourth consecutive month that employment has risen, but the upturn has been modest. The economy has been adding jobs by an average of 39,000 a month since February. Compare that to the 2003 average of 103,000 a month during the first four months of job creation after the last recession.
Moreover, key areas of the economy are still experiencing job loss. May marks the thirty-fifth consecutive month in which construction employment has declined. Last month, 41,000 construction workers were sent to the unemployment line. That is only slightly less than the 42,000 workers who lost their jobs in April. In total, construction jobs have declined by 2,191,000 since they reached their peak in January of 2007. Employment in the financial services sector was also down last month. It declined by 8,000 jobs and it has not seen a job increase in over 3 years.
While the fact that employment is once again rising is a good sign, the average number of jobs being created isn't enough to employ the college graduates and other new workers entering the workforce each month. There will need to be far greater increases before those who are unemployed begin finding work.