US Employment Update: NFP and Unemployment Rate

This Friday as every month, the non-farm payrolls and the unemployment rate corresponding to the month of May in the United States will be known. The context of the data is marked by the results of both the manufacturing PMI and the services PMI of that country.

The data that will be published in the next few hours has as a background the positive results that were released this week from the PMI measurements.

Both the manufacturing sector and the service sector gave far better results than expected, marking an acceleration in the growth rate.

However, both indicators present difficulties in the employment sector, to be able to fill the vacant positions. The reasons for which the occupation of these positions is not reached are variable. From the impossibility of leaving the care of minors, the fears of contagion and the attractions that state economic assistance represents in the face of unemployment. For this reason, some states have begun a process of reducing the assistance programs promoted by the current Administration.

In this sense, new applications for initial jobless claims fell but at a marked slower rate than in the last four weeks. The latest data represents 395K new applications, the lowest result since the beginning of the pandemic. The continuing jobless claims did not decrease, but instead presented a new increase, the highest in four weeks, reaching 3771 K.

The non- farm payroll data for May foresees an increase in them of around 650 K. These projections take place due to the context of reopening and the road to recovery after the pandemic.

Given the context, the unemployment rate is projected to mark a monthly decrease towards 5.9%.

The evolution of employment and economic recovery is seeking to advance towards pre-pandemic levels according to the objectives of the Treasury and the Federal Reserve.