Not So Great: 94,983,000 Americans Not in the Labor Force in May

By Susan Jones | June 2, 2017 | 8:46 AM EDT

(Photo from Wikimedia Commons)

(CNSNews.com) – A disappointing report from the Labor Department’s Bureau of Labor Statistics on Friday: The economy added 138,000 jobs in May, fewer than analysts were expecting; and after setting three straight monthly records, the number of unemployed Americans dropped by 233,000 to 152,923,000.

The unemployment rate ticked down a tenth of a point to 4.3 percent, near historic lows.

But the number of Americans not in the labor force – meaning they are neither working nor looking for work – increased by 608,000 to 94,983,000 in May, close to the record high of 95,102,000 in December 2016.  The not-in-the-labor-force number includes retirees, students, homemakers, the disabled, and others who have stopped looking for work for whatever reason.

The nation’s labor force participation rate – the percentage of the 16-and-older civilian non-institutionalized population that is either employed or actively seeking work – dropped two-tenths of a point to 62.7 percent in May.

The higher the percentage, the better, since people who participate in the labor force contribute the payroll and other taxes that help support many of those who do not work. The participation rate hit a record high of 67.3 percent in early 2000, plunging to a 38-year low of 62.4 percent in September 2015.

“The economy is starting to come back, and very, very rapidly,” President Donald Trump said on Thursday, as he announced that the United States will withdraw from the Paris climate accord because it costs too much money and would kill millions of American jobs.

BLS says in the first five months of 2017, the economy has added a total of 810,000 jobs (fewer than the million Trump mentioned on Monday). Job gains for March and April were revised downward in the May report and are well below the strong gains of January and February.

Job gains for the most recent month occurred in health care and mining. (Employment in mining has risen by 47,000 since reaching a recent low point in October 2016, with most of the gain in support activities for mining.)

In May, the nation’s civilian noninstitutionalized population, consisting of all people age 16 or older who were not in the military or an institution, reached 254,767,000. Of those, 159,784,000 participated in the labor force by either holding a job or actively seeking one.

The 159,784,000 who participated in the labor force equaled 62.7 percent of the 254,767,000 civilian noninstitutionalized population.

In May average hourly earnings for all employees on private nonfarm payrolls rose by 4 cents to $26.22. Over the year, average hourly earnings have risen by 63 cents, or 2.5 percent, BLS reported.