(Updated from 8:42 a.m. EDT)
Job losses were about as expected in May and the
, which was expected to climb, actually fell last month, to 4.4% from 4.5%. The latest government data, released this morning, suggests -- at least for one month -- that deterioration in the labor market leveled off a bit.
dropped by 19,000 last month, a bit higher than the expected 17,000 loss, according to this morning's
The unemployment rate had been expected to rise to 4.6%. April's massive loss on nonfarm jobs was revised to 182,000 from an original estimate of 223,000, and March's payroll figure was actually revised to reflect a gain of 59,000 nonfarm jobs from a loss of 53,000.
Stock futures improved after the report was released, and tech stocks were poised for a positive open. Bond prices are slightly lower across the board. The bond market rallied in front of today's report, reflecting the belief that the report would be worse than economists expected, and today it's giving back some of yesterday's gains. Bond yields tend to rise in anticipation of economic strength or inflation. Bond yields are rising because this report isn't as bad as many feared it would be.
Job losses were concentrated in the manufacturing sector, which shed 124,000 jobs in May, following a loss of 113,000 in April. Since last July, 675,000 manufacturing jobs have been lost, with more than two-thirds of the decline occurring since December. Jobs in the service sector rose by 70,000 in May after a revised increase of 6,000 in April. The construction sector gained 31,000 jobs in May, after losing 78,000 in April.
Average hourly earnings rose 0.3% in May, which was expected. It puts the year-over-year rate at 4.4%, the strongest in three years.
Following the opening bell, the May
Purchasing Managers' Index will be released. The PMI, a survey of approximately 300 purchasing executives nationwide, measures the conditions of the factory sector. A reading of 50 or above signals expansion, while below 50 signals contraction. The index has not been above 50 since July 2000.
Seasonal adjustments to the payroll data are somewhat responsible for the turnaround in the jobs data for March. The
revised the seasonally adjusted nonfarm payroll figures going back several years, which is its usual practice.