Although the U.S. unemployment rate dipped slightly in May - to 9.7% from 9.9% - two factors in it spell more difficulty and frustration for the nation's 15 million unemployed, 6.8 million who have been out of work six months or longer.
Although about 430,000 people found jobs in May, leading to the drop in the unemployment rate, almost all of the hiring was of temporary U.S. census workers by the federal government. Private employers, the true drivers of the economy, added just 41,000 jobs, about one-quarter what economists had predicted would be created. It also was the fewest added since January, the Labor Department reported this morning, and 177,000 fewer than were created in the previous month.
The "underemployment" rate - made up of those who have given up looking for work and part-timers who would rather be working full time - fell to 16.6% from 17.1% in the prior month. But the number of people out of work six months or longer reached 6.76 million, a new high. They made up 46% of all unemployed people, also a record high.
The Gallup organization Thursday also detailed one aspect of the difficult psychological toll long-term unemployment has on individuals. Unemployed Americans' hopes for finding work drop sharply as their length of unemployment increases. Among job seekers who have been unemployed less than one month, 71% think they'll find work within the next month. For those who have been unemployment for more than six months, that percentage drops by almost one-half, to 36%, the organization found in the latest installment of a tracking poll it conducts.
Gallup also called for greater attention to the millions of underemployed Americans, which its research placed at 19.1%, far higher than the official government number. Gallup speculated that the financial crisis in the European Union, the decline in the stock market, and Gulf oil spill have spooked employers. "Regardless, the nation needs to expand its focus to include not only the unemployed, but also the underemployed," Gallup opined.
About 125,000 new jobs are needed each month just to keep up with population growth and prevent the unemployment rate from rising. Hiring isn't expected to be consistently strong enough to quickly drive down the unemployment rate for at least the remainder of this year.