According to monthly jobs report published in June 2017 by the Bureau of Labor Statistics (BLS), the U.S. economy generated 138,000 new jobs in May 2017, falling below consensus expectations of 184,000 jobs. The unemployment rate remained steady at 4.3%, and the labor-force participate rate declined by 0.2 percentage points to 62.7%.
Employment gains were strongest in healthcare (+24,000) and mining (+7,000). Job growth in healthcare has averaged 22,000 per month so far in 2017, compared to an average monthly gain of 32,000 in 2016. Mining employment has grown by 47,000 since reaching a low point in October 2016.
Employment continued to trend up in professional and business services (+38,000) and food services and drinking places (+30,000). Other major industries saw little change over the month.
Employment Index, 2016-2017
Wages Index, 2016-2017
Average hourly earnings for all employees on private nonfarm payrolls increased by 4 cents to $26.22. Through 2017, average hourly earnings have risen by 63 cents or 2.5%.
Same Month, Different Report
The ADP National Employment Report for May 2017 showed that U.S. businesses added 253,000 workers, a considerable difference in figures from the BLS. Over the past seven months, the ADP tabulation has seemed noticeably stronger than the BLS Employment Situation Report. Among the industries in ADP’s report, good-producing businesses added 48,000 jobs (led by 37,000 jobs in construction), while service industries added 205,00 jobs. Among the service industries, the strongest gains were seen in trade, transportation and utilities (+58,000), professional and business services (+88,000), and education and health services (+54,000).
What’s Going On With Retail?
In May 2017, the retail sector shed jobs for the fourth consecutive month. Since February 2017, nearly 80,000 retail jobs have been lost, and many chains have announced closing or bankruptcy, including Rue21, BCBGMaxAzria, Wet Seal, and Payless. Meanwhile, some other retailers such as JCPenny, Abercrombie & Fitch, and Gap are expected to trim their store counts by 20% or more.
Retail Job Growth/Loss Over Past Year
Meanwhile, consumers are showing a clear preference for online retailers such as Amazon. Amazon reported record holiday sales in 2016, and recently more than doubled its operating income from $1.5 billion in 2015 to $3.1 billion in 2016, giving the company even more financial flexibility to compete against rivals.
A report by Cowen & Co estimates that about 20% of U.S malls will have to be repurposed or closed. Credit Suisse states that more than 8,640 stores could close in 2017. However, most industry experts agree that brick-and-mortar stores are still a necessity. A separate survey by Cowen & Co found that 75% of shoppers prefer to shop in a in a physical store. The United States has a large amount of surplus retail space – about 7.3 square feet of retail space on a per-capita basis, well above 1.7 square feet in Japan and France and 1.3 square feet in the U.K.