Every 10 years, the May jobs report comes with a giant asterisk next to it, reflecting the hiring of hundreds of thousands of temporary workers to manage the US Census. Those are real, decent-paying jobs, but they last 2-3 months at the most. The June jobs report becomes a drag on the overall number, as those Census enumerators complete their term of service.

So you have to read the May 2010 jobs report by both taking in the overall number AND by subtracting out the Census jobs. And with that in mind, you can see that May reflected a step backward for hiring.

Total nonfarm payroll employment grew by 431,000 in May, reflecting the hiring of 411,000 temporary employees to work on Census 2010, the U.S. Bureau of Labor Statistics reported today. Private-sector employment changed little (+41,000). Manufacturing, temporary help services, and mining added jobs, while construction employment declined. The unemployment rate edged down to 9.7 percent.

Last month, private-sector employment increased by over 200,000.

It’s fantastic that we’ve gained jobs in every month of the year. But 41,000 private-sector jobs a month won’t cut it, especially when the public-sector hiring goes away. Not only will Census jobs end, but state and local budgets deprived of revenue will lead to legislatures deciding on more cuts to those government payrolls (state government employment dropped last month by 13,000). And while the stimulus has reliably created jobs in the private sector, that money has mostly gone out the door and is on the decline of its effectiveness. The unemployment rate only decreased because the participation rate decreased – in other words, more people left the workforce altogether.

Reading between the lines shows a very fragile recovery, and once the Census gets out of the system, I’m not sure what will drive an inexorably – intolerably – slow return to employment growth.

The March number was revised slightly downward as well.

UPDATE: The reactions are rolling in. EPI President Larry Mishel: “These new data do not present a picture of a healthy private sector and offer nothing even closely resembling the job growth we need to dig us out of a very deep hole.” CEPR’s Dean Baker: “This report is a clear warning that the recovery is very weak. The weakness is in spite of the temporary stimulus provided by the hiring of 550,000 Census workers. With house prices falling again, severe state and local budget cutbacks looming, and troubles in Europe dampening exports, the future is not bright.”