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Rise in unemployment rate means growing unemployment for African Americans and Latinos

By Masao Suzuki |
June 3, 2012
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San José, CA - On June 1, the Department of Labor released its monthly report on unemployment and employment for May, 2012. The report said that only 69,000 jobs were added in the U.S. economy in May, less than half of what professional economists had been predicting. Even worse, the report revised earlier estimates of job growth in March and April down by another 49,000 jobs.

The weak job creation was reflected in the rise in the official unemployment rate, which rose by one-tenth of one percent, from 8.1% in April to 8.2% in May. This rise in unemployment was concentrated among oppressed nationality workers: the unemployment rate for African Americans rose from 13.0% to 13.6%, and the unemployment rate for Latinos rose from 10.3% to 11.0% between April and May. In contrast the unemployment rate for whites stayed the same, at 7.4%.

There was even more bad news in other parts of the report. Average weekly hours of work fell by one tenth of an hour, as more people had to take part-time work because of the poor economy. The broadest measure of unemployment, which includes people at work part time who can’t find full-time work rose from 14.5% to 14.8%. In fact the survey of households (on which the unemployment rate is based, as opposed to the survey of businesses that provides the number of new jobs) said that all of the gain in jobs came from part-time work, as the number of fulltime workers actually fell in May.

300,000 more workers said that they had been out of work for more than six months in May as compared to April, and now make up almost half (43.8%) of total unemployed. The average length of unemployment rose from 39.1 to 39.7 weeks, or almost ten months.

The poor employment report was the third month in a row that job growth has slowed and shows a slowdown in the U.S. economy. From December of 2011 to February of this year, an average of more than 250,000 net new jobs were created each month. But from March through May, the average was less than 100,000 net new jobs a month. Contributing to this problem is the continuing loss of government jobs, down another 13,000 in May alone, and 161,000 over the last year. The biggest loss in May was in public education, which makes up more than half of government job losses for the month.

The future is looking increasingly grim as major corporations such as Hewlett-Packard are announcing job cuts of tens of thousands while government at all levels (federal, state, and local) are cutting back on jobs. With almost half the Euro-zone countries already in a recession and growing signs of economic slowdown in Asia and Brazil (Latin America’s largest economy), the world capitalist economy is showing signs of stagnation - slow economic growth coupled with high unemployment - while the danger of another worldwide economic crisis is rising.