Comment on U.S. Bureau of Labor Statistics Employment Situation Report

Kathy Bostjancic, Director for Macroeconomic Analysis, The Conference Board

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Jun 03, 2011, 09:04 ET

NEW YORK, June 3, 2011 /PRNewswire/ --

Labor Market Massively Lags

Job growth slowed substantially in May as the overall economy is starting to show choppiness. There is some weakness in manufacturing and construction. The real story, however, is the lack of stronger job growth in "core" services which excludes the secular gains in health and education. Relatively modest gains in consumer spending are limiting job growth in "core" services. With households worried about high gas and grocery prices, and the slow pace of wage gains, spending could even slow a little more this summer. Employers spent a great deal of time and attention reducing costs over the past few years and are reluctant to add to their cost structure unless they can be certain the economy will not hit a soft patch. This degree of caution could remain in evidence right through Labor Day.

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