Insights and Perspective

 

Insights and Perspective

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GSI Labor Market Forecast: May 2021

By Phillip Sprehe

The Bureau of Labor Statistics (BLS) will release its monthly Current Employment Statistics (CES) and Current Population Survey (CPS) report for May 2021 on Friday, June 5. Geographic Solutions, Inc. has produced forecasts of the two most closely watched macroeconomic data series from the report: the monthly change in employment and the monthly unemployment rate. 

Job growth in April (+266,000) signaled the U.S. went through a hiccup in the recovery which should eventually return to the job increases of summer 2020. The three crucial factors that have prevented people to return to work are lingering fears of the pandemic, watching over children who are not in school, and extended unemployment benefits. The $1,400 that most people received in the last relief bill provided a nice cushion that has probably been exhausted by now and compelled many to accept job offers. This is backed up by the GSI job applications data which had its highest monthly percent increase since May 2020 when the U.S. created 2.8 million jobs.

Geographic Solutions derives its employment forecast from internal data on the number of job openings, job severances, job searchers, and job applications. As seen in the chart below, we predict job growth in May of 2.7 million.

Portrayed in the table below is the 5.6% unemployment rate that Geographic Solutions forecasts for May, the first time the unemployment rate declined below 6.0% since its pandemic peak in April 2020. The unemployment rate forecast used internal data on job applications, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor.

After the release of the report, Geographic Solutions will post a full analysis of the results.



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