Employment
Total nonfarm payrolls increased just 54,000 in May, after increasing by 232,000 in April (originally reported as 244,000). March’s data was revised down as well, to 194,000, from 221,000 (total revisions pushed total payrolls lower by 39,000.) Total private jobs increased by 83,000 in May. The unemployment rate rose from 9.0% in April to 9.1% in May, the second consecutive increase. Average weekly hours worked remained unchanged at 34.4 hours and average hourly earnings for all employees posted a slight increase of $0.06 for the month of May. The weak economic growth in the first quarter seems to have caught up with the labor market in the most recent data. As the economy gradually picks up in the following quarters, the employment situation should improve as well.

ISM Manufacturing
The Institute for Supply Management's (ISM) manufacturing index decreased in May to 53.5 from 60.4 in April. May’s decline was steeper than expected and marks the third consecutive monthly decline. Every component in May’s report declined, including the employment and new orders indexes. Despite the decline, the report is still consistent with an expanding economy, albeit at a slower pace. This report is consistent with a slower pace of growth and the momentum we have seen in manufacturing is easing.

Factory Orders
New orders for manufactured goods fell 1.2% in April following an increase of 3.8% in March. Orders for nondefense capital goods excluding aircraft, so called core orders, decreased 2.3% after gaining 5.4% in March. Shipments decreased 0.2% following an increase of 3.1% in March. Shipments of nondurable goods increased 0.6%, however, durable goods were down 1.3% for the month. Manufacturers’ inventories rose 1.3% in April. Unfilled orders increased slightly by 0.3% from following March’s 0.7% gain. These data suggest that inventory investment should be a positive contributor to future GDP growth.