JIM LEHRER: Unemployment was the lead story today. The rate hit a 26-year high in May, but job cuts slowed for the fourth month in a row. The Labor Department released those numbers today.
The jobless rate rose 0.5 points to 9.4 percent, more than expected. But the number of jobs lost, at 345,000, was the fewest since last September.
At the White House, Vice President Biden said there are some signs of hope, but not nearly enough, yet.
JOSEPH BIDEN, Vice President of the United States: Let me be very clear: Lower job rate loss is not our goal. Less bad, less bad is not how we’re going to measure success, we’re going to measure success here in the White House.
We will not be satisfied until we’re adding jobs on a monthly basis, providing working Americans with a stable job, dependable incomes, ensuring that everyone who wants to make their way into the middle class has a shot to get in the middle class.
JIM LEHRER: On Wall Street, reaction to the unemployment news was mixed. The Dow Jones Industrial Average gained 12 points to close at 8,763. The Nasdaq was mostly flat and closed at 1,849. For the week, the Dow gained more than 3 percent; the Nasdaq rose more than 4 percent.
Jeffrey Brown has more on the unemployment story.
Recent college grads increase
JEFFREY BROWN: And we take a closer look at today's job numbers with Lisa Lynch, dean of the Heller School for Social Policy and Management at Brandeis University and former chief economist at the Labor Department.
Well, this is something of a good news/bad news picture today. Let's start with the good: Job losses were smaller than had been anticipated. What do you see going on?
LISA LYNCH, Brandeis University Economist: Well, it's a little hard to understand why you have 345,000 jobs going down and an unemployment rate up at 9.4 percent and people are saying, how did it rise so much with the jobs not going down as much?
And what we had in this month's report with a wave of new entrants coming into the labor market -- a lot of college students who just graduated, students that are finishing the term -- and they increased the number of people that were unemployed. And employers reduced the amount of -- numbers of workers that they were laying off.
But we still had a significant decrease in employment: 345,000, as the vice president said, is less bad, but it's still bad.
JEFFREY BROWN: But on the other side, companies are not yet hiring anybody back, right?
LISA LYNCH: No, they're not hiring people back, and we're also seeing employers that have kept workers on the payrolls continuing to reduce their hours.
So we have now over 9 million workers who are reporting that they're in employment but are working fewer hours, plus the 14.5 million workers who are out of work. So we have a significant increase in unemployment and underemployment. And when you add all those workers together, that rate is 16.4 percent.
Many unemployed aren't counted
JEFFREY BROWN: Yes, it's worth reminding ourselves and viewers that the jobs number does not include people who are no longer even looking for work, right?
LISA LYNCH: No. So people that are discouraged, they're working in a town with maybe, say, one company in town, an auto plant, and that plant is shut down, they're in their home, that's their primary asset, they can't sell it, they know there's no other jobs in their community, they stop looking, not that they're not willing to work, but they know there's not options for them in the area, they're not counted in the official statistics as unemployed.
Deep losses in manufacturing jobs
JEFFREY BROWN: What do today's numbers tell us about specific sectors? We've talked about that a lot over the last few months, looking at manufacturing and services. What did we learn today?
LISA LYNCH: So the good news was that we saw a set of sectors that, while they continue to shed jobs -- for example, the construction industry lost 59,000 jobs -- that pace of job loss was much less than had been the case before.
So that's maybe some evidence of the stimulus package and the construction industry starting to take root with new public works projects and roads, et cetera, that are hiring some construction workers, or at least the decreases in employment are not so great.
We saw health care continuing to add jobs to the economy. We saw some increase in eating and drinking establishments and performing arts and sports arenas. So people seem to be going out a little bit more for dinner and maybe seeing a show or a baseball game, so that's good news.
We saw the job loss in professional and business services, again, about a third of what its average rate had been over the last six months.
But when we look at manufacturing, there we lost 156,000 jobs in the month of May; 3 out of 10 jobs that have been lost in this recession have been in the manufacturing sector. And with this week's news on the auto industry, with further job loss in General Motors of 20,000 workers, and the associated suppliers in that industry, unfortunately, the job loss in manufacturing is not over.
Stimulus funds to help construction
JEFFREY BROWN: You know, you mentioned the stimulus dollars, and we heard Vice President Biden just ahead of us. Another thing he said was that, on Monday, President Obama is going to announce a plan to what he said -- what he referred to as "ramping up" recovery programs.
That makes me wonder: Do we know yet or how much do we know about to what extent the stimulus dollars are having any impact on jobs? Or when do you expect that it might kick in?
LISA LYNCH: Well, I mean, the places that you want to look at in the employment report for evidence of the stimulus package having an impact would be the construction industry, especially for nonresidential construction. We should start seeing that coming in, in the summer.
There's some evidence that the stimulus is already having an impact insofar as state and local employment has not decreased, and we know states are struggling with their budgets. And without the stimulus bill, they would have been laying off many more workers than they have, teachers and police officers, in particular.
So there, the stimulus money is preventing job loss. So sometimes what you're looking for is a number that's not moving as opposed to a number that's increasing.
But hopefully, as the economy then picks up in the latter part of the summer, going into the fall, we'll start seeing evidence across more sectors of the economy of that stimulus.
JEFFREY BROWN: All right, well, Lisa Lynch of Brandeis University, thank you very much again.
LISA LYNCH: Thank you, Jeff.