Jobless Rate Skews Picture Of Labor Market --- Big Drop Overstates Trend; Payroll Rise Suggests More Moderate Growth
WASHINGTON -- May's big drop in the unemployment rate to 6% from 6.4% from April overstates the rate at which the job market is improving.</br></br>Labor Department officials said the more moderate rise of employment recorded in its separate survey of business payrolls -- which grew by 191,000 jobs last month -- is probably a more accurate gauge of the economy. That number suggests the economy is growing at a moderate, but not excessive, rate.</br></br>Katharine G. Abraham, commissioner of the Bureau of Labor Statistics, said the sharp decline in the unemployment rate "probably overstates what's going on." After the initial figures are revised, "it would not be surprising if we ended up with a number for May that's a little higher," she said.</br></br>Employment in manufacturing, where the pay is generally higher, fell in May, while service jobs accounted for most of the growth last month.</br></br>The White House called a news conference to boast of the figures, but some analysts were concerned that the continued sizable increases in average hourly earnings might be a harbinger of inflation.