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Job seekers wait in line to fill out applications for employment during a job fair in San Francisco, Calif. - 

JEREMY HOBSON: On Friday we get the official government report that'll tell us how many jobs the economy added last month and what the new unemployment rate is. Well just in the last hour we got an early look at May employment from the job placement firm Challenger Gray and Christmas.

And CEO John Challenger is with us live from Chicago with the details. Good morning.

JOHN CHALLENGER: Good morning Jeremy.

HOBSON: Well tell us what happened in May.

CHALLENGER: The pace of downsizing remained virtually unchanged in May. U.S. employers announced plans to cut 37,135 jobs -- that's just 1.8 percent more than what they cut in April. It's actually 4.3 percent down from May a year ago.

HOBSON: John, yesterday we heard home prices are still falling. And I wonder whether you think it's going to take an uptick in the job market to get the the housing market back on track, or the other way around?

CHALLENGER: Yeah. I don't think this is a chicken or an egg scenario. Jobs are the key to housing. We need people who have steady incomes who can go out and buy homes, pick up some of those homes that are sitting fallow because nobody wants to buy them -- they're sitting on the bank's books. So key to this turnaround are putting people back to work.

HOBSON: And finally, what do you think is going to happen with this Friday report?

CHALLENGER: I think we're seeing job creation now on a sustained basis -- almost three-quarters of a million in the last three months. That should continue. Hopefully over 200,000 jobs will be created, and that'll put pressure on the unemployment rate to go down.

HOBSON: John Challenger, CEO of Challenger Gray and Christmas, thanks so much.

CHALLENGER: Thank you.