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US Manufacturing Loses 10,000 Jobs in May on Durable Goods

By Bill Koenig
Senior Editor

US manufacturing lost 10,000 jobs in May amid sharp cuts in employment in durable goods.

The losses were paced by machinery, down 7300 jobs, transportation equipment (down 3200) and fabricated metal products (down 2900).

Makers of durable goods overall lost 18,000 jobs, while producers of non-durable goods, such as food and apparel, added 8000, according to a breakdown by industry issued today by the Bureau of Labor Statistics.

Manufacturing jobs totaled 12.285 million in May on a seasonally adjusted basis. That compares to 12.295 million in April and 12.324 million in May 2015.

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“I see no signs of the much-hyped manufacturing renaissance,” Steven Rattner, former head of the Obama administration’s auto task force, wrote in a post on Twitter in response to the jobs report.

The 3200 job loss for transportation equipment included a 500 job loss for automakers and their suppliers. Over the past year, the auto industry has been a bright spot for manufacturing amid strong sales for light trucks.

However, there are signs of cooling, particularly in passenger car production.

FCA US LLC has said in July it will eliminate one shift at its Sterling Heights, MI, assembly plant. That will put 1300 workers who build the Chrysler 200 car there on indefinite layoff.

In May, US sales of light vehicles fell 6% to 1.54 million, paced by a 16% slide in passenger car deliveries, according to Autodata Corp. (Woodcliff Lake, NJ). Light truck sales gained 2.3% in May.

Total deliveries are up only 1.2% through the year’s first five months to 7.13 million. Passenger car sales are down 7.4% during that period while light truck sales are up 8.7%

The main durable goods industry job gainer was semiconductors and electronic components, up 1900. All other industry gainers had increases of fewer than 1000 jobs.

The manufacturing job losses were part of a poor monthly jobs report. Total nonfarm employment only increased by 38,000 in May, according to a bureau statement. It was the lowest jobs gain in more than five years. The average estimate among economists polled by the Reuters news service was for a rise of 164,000.

Despite the anemic job creation figure, the US unemployment rate for May declined to 4.7% from 5% the month. “Labor force participation,” the percentage of working-age people employed or looking for work, declined.

Manufacturing jobs peaked in June 1979 (19.6 million on a seasonally adjusted basis, 19.7 million unadjusted). That sank to a low of 11.45 million adjusted and 11.34 million unadjusted in February 2010 following a severe recession caused by the 2008 financial crisis.

Since the low, there have been a gradual gain in manufacturing jobs. New jobs in the sector require increased skills because of more automation and technologies in factories.

Published Date : 6/3/2016

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