The unemployment rate jumped from 5.0 percent to 5.5 percent in May. The decline in non-farm payroll jobs was approximately 50,000. That’s not a good number, but it doesn’t account for the remarkable spike in the unemployment rate. Rather, that spike would appear to be mostly the result of a sharp increase in the number of people seeking work (the unemployment rate does not encompass people who aren’t looking for jobs). The increase in unemployment is disportionately high among people between the ages of 16 to 24 and that may well be where the increase in labor force participation was greatest.
But regardless of how one analyzes the numbers, the increased unemployment rate is bad news for John McCain, since it will be viewed as clear evidence of a major economic downturn for which Republicans will be blamed.
UPDATE: Ed Morrissey makes the excellent point that the increase in the minimum wage imposed by the Democrats makes it significantly more expensive to employ certain kinds of entry-level workers. This might well help explain why the labor market has been unable to accommodate many of the teenagers and college students who entered that market in May.
To comment on this post go here.