What the May jobs report says about the nation’s economic outlook

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• William Brangham:

  As we reported, employers added 390,000 jobs in may. That is the 17th straight month of job growth. Over the past year, employers have added more than 6.5 million jobs.

  Betsey Stevenson served as chief economist for the Department of Labor from 2010 to 2011. She is now a professor of public policy and economics at the University of Michigan.

  Betsey Stevenson, great to have you on the "NewsHour."

  We heard the president bragging about today's numbers, but also cautioning that we are not going to see similar blockbuster jobs reports going into the future. And he said that was a good thing.

  How do you see today's report?

  Betsey Stevenson, Former Council of Economic Advisers Member: Well, I think it is worth thinking about just how rapidly we recovered.

  So, if you go back to the 2008 recession, it took over eight years for us to get unemployment below 4 percent. And we did that with — in less than two years. We have got unemployment that is stable at 3.6 percent, which is just great. It is really low unemployment.

  And yet, at the same time, we are seeing rapid job growth as people are reentering a labor force. So, where — if we have got unemployment at 3.6 percent, how do we find nearly half-a-million people to hire? We do that by bringing people in from the sidelines into the labor force.

  And we are continuing to do that. We have seen job growth slow a little bit to 400,000 the last two months. It was running at a faster clip a little bit before that. That can't go on forever. We don't have that many people in the country to bring back. A couple more months of this kind of growth, and we are going to be back at the labor force participation rate we had prior to the pandemic.

  So, I think we need to start thinking about, can we get ourselves to a place where we had the kind of growth we were experiencing prior to the pandemic, and sort of at that level of labor force participation? And that's going to be adding 200,000, 100,000 jobs a month, and sort of growing steadily.

  So that's what bringing this sort of this labor market in without really slowing it is all about, is bringing a bunch of people back into the work force, allowing us to continue to grow. But, obviously, we can't grow at 400,000 or 500,000 jobs a month forever, or we just run out of people.

• William Brangham:

  Right. We haven't figured out a way to manufacture new humans. That's — we're lagging in that manufacturing department.

  There are certain sectors, given this, that there are still employers that are really looking for workers and have a lot of open vacancies.

• Betsey Stevenson:

  Well, there are a lot of vacancies out there.

  We're really still at record high openings. And, I mean, for most people, what this means is, the opportunities out there to find a job that fits you well, that pays what you want, that allows you to meet sort of work/family balance that's maybe in the location you want is better than it's ever been.

  So I hope lots of people are out there looking for those new opportunities. We see across a lot of industries really different experiences. Let's take the airline industry, which is saying, well, we can't hire people, we're cutting flights. And yet they have more people employed in air transportation than we had prior to the pandemic.

  What's going on? Part of it might be that they lost a lot of experienced workers, and it's taking time to get the new people they are hiring back up to speed. It may be that the industry itself has had to change because of the pandemic.

  Well, then you could switch over to leisure and hospitality, which still has a lot of growth. We haven't seen demand come all the way back. We haven't gotten all the workers back. And they added over 80,000 jobs in this past month, one of the strongest sectors of growth. It's growing because consumers are continuing to increase their demand for leisure and hospitality.

  But what we saw on this report is, if you want to hire, they are coming, because I think it's good news. The markets didn't like it. But if employers had been trying to hire all those people, and there hadn't been able to hire them, that's when you really got to worry. What we saw this time was, employers wanted to hire, workers wanted to take the jobs, and we saw expansion of 390,000 jobs.

• William Brangham:

  I saw that you pointed out today that women also had surged back into the work force amongst those new employees. What do you think is driving that specifically?

• Betsey Stevenson:

  So we have seen, in particular, labor force participation among women start to increase over the last sort of four to six months.

  Some of that may be due to the fact that schools are finally starting to settle down, not sending kids home for as many you have got to do a two-week remote school because of this COVID outbreak. Might be a little bit of that.

  It can also just be that it takes time for people to reenter the labor force. So, women took on other responsibilities outside of the labor force, caregiving responsibilities, more broadly than just their children. And they got to figure out how to now balance those responsibilities they take — took on with a job they want to find. It just takes a little bit of time.

  But what we have seen is steadily, over the last few months, these women are coming back. What happens in most recoveries and is happening in this one is that the more highly educated people come back faster and first. So we have seen, in particular, labor force participation among college-educated women recover much faster.

  But we are starting to see some recovery in the labor force participation of women with less education. That does tend to happen more slowly. And I personally hope that the economy stays strong enough to bring more of those women back in over the next few months.

• William Brangham:

  Betsey Stevenson at the University of Michigan, thank you so much for being here.

• Betsey Stevenson:

  Thank you. It's nice talking with you.