U.S. unemployment up to 5.5 percent

The unemployment rate rose from 5 to 5.5 percent in May, and nonfarm payroll employment dropped by 49,000, the U.S. Department of Labor Bureau of Labor Statistics of the U.S. reported today.

In May, employment continued to fall in construction, manufacturing, retail trade, and temporary help services, while health care continued to add jobs. Average hourly earnings rose by 5 cents, or 0.3 percent, over the month.

The number of unemployed persons increased by 861,000 to 8.5 million in May, after seasonal adjustment, and the unemployment rate rose by 0.5 percentage point to 5.5 percent. One year ago, the number of unemployed persons was 6.9 million, and the jobless rate was 4.5 percent.

Employment in construction fell by 34,000 in May. Since an employment peak in September 2006, construction has lost 475,000 jobs. Over the month, employment declined among residential specialty trade contractors and in construction of buildings. Manufacturing employment continued to fall over the month, with job losses in wood products, computer and electronic products, and nonmetallic mineral products (-5,000). Thus far in 2008, monthly job losses in manufacturing have averaged 41,000m compared with 22,000 per month in 2007 and 14,000 per month in 2006.

Retail trade employment decreased by 27,000 in May. Job losses in department stores and gasoline stations accounted for most of the decline. Since March 2007, retail trade has shed 184,000 jobs.

Employment in professional and business services was down in May; the industry has lost 124,000 jobs in 2008. Over the month, employment in temporary help services continued to decline and has fallen by 193,000 since its most recent peak in December 2006. Accounting and bookkeeping services also lost jobs over the month.

Employment continued to rise throughout health care in May. Job growth over the last 12 months has totaled 383,000.

Elsewhere in the service-providing sector, food services and drinking places employment continued to trend up in May, but job growth in this industry has slowed recently. Employment gains averaged 12,000 per month from November through May, compared with 27,000 per month during the first 10 months of 2007.