Jim Walker, an author and speaker on workforce issues, says the jump in the jobless rate from 5 percent in April to 5.5 percent in May primarily reflects workers with less-desirable skills.
“They aren’t necessarily the ones that companies are scrambling to compete for,” he says.
Employers in the growing fields of health care and technology, Walker argues, may still have a hard time finding the right candidates. International trade is another such industry, he says.
On Friday, the Labor Department released its latest employment situation figures, which showed a drop of 49,000 nonfarm payroll jobs.
The news fueled fears that a recession is under way. The U.S. economy grew at an annual rate of 0.9 percent in the first quarter of the year.
But in the wake of the housing market meltdown, soaring oil prices and trouble in the financial markets, typical Americans are feeling pain in their pocketbooks. According to a USA Today/Gallup Poll published this week, 55 percent of Americans surveyed said their families are worse off financially than they were a year ago.
That’s the highest number since Gallup first asked the question in 1976 and an increase of 11 percentage points since February.
According to the June 6 Labor Department report, payroll employment has declined by 324,000 so far in 2008. In May, job losses continued in construction, manufacturing, retail trade and temporary help services.
By contrast, the health care sector added 34,000 positions in May. Health care job growth in the last 12 months has totaled 383,000.
The field of management and technical consulting services added 5,300 jobs in May.
In the face of the economic slowdown, some employers have been seeking to avoid sweeping layoffs and looking to take counter-cyclical steps such as poaching talent from rivals.
Even so, the financial pain felt by many Americans is thrusting economic policy and concern about the country’s relatively skimpy safety net to the fore and into the November presidential election.
For employers, a silver lining to the rise in the unemployment rate is that high-skilled workers are easier to retain, Walker says. In other words, a weak labor market strengthens the employer’s hand.
“People don’t jump around and quit on the spot quite as much,” Walker says.