Economist: April Jobs Report Broadly Disappointing

Not only is the 115,000 jobs added to the U.S. economy last month disappointing, the the impact of that meager performance is broadly felt, according to an independent Washington economist.

The Labor Departmnent released employment data Friday for April, and the national unemployment rate ticked down to 8.1 percent, but that was largely due to discouraged job-seekers who gave up looking for work, and thus are no longer counted in the unemployment data.

“Today’s employment report shows that April’s job growth was disappointing for the second straight month and that the economic costs in terms of fewer jobs, less income, and lower growth remain very high.  In particular, the number of workers in the Labor Department’s broadest measure of labor market underutilization — comprising the unemployed, discouraged workers and others ‘marginally attached’ to the labor force who nonetheless have indicated they want to work, and people working part-time for economic reasons — stands at roughly 23 million.  That’s much higher than at the start of the recession or, before that, than any time for which we have available data, dating back to 1994,” says Chad Stone, chief economist of the Center for Budget and Policy Priorities, a left-leaning think tank.

Private and government payrolls combined rose by 115,000 jobs in April. Private employers added 130,000 jobs, while government employment fell by 15,000.  Federal employment fell by 4,000 and local government employment fell by 12,000; state government employment rose by 1,000.

Although April was the 26th straight month of private-sector job creation, there were still 5 million fewer jobs on nonfarm payrolls in April than when the recession began in December 2007 and 4.6 million fewer jobs on private payrolls. Payroll job growth in March and April took disappointing steps backward from the pace of job creation in January and February, and the nation remains well short of the sustained growth of 200,000 to 300,000 jobs a month or more that is typical of a robust jobs recovery, Stone says.

“The March and April employment numbers seem to bear out fears that the pickup in job gains of January and February may have been boosted more by favorable weather conditions than by a fundamental strengthening of the economic recovery,” he adds. “ Last week’s preliminary estimate that the economy grew at a modest 2.2 percent annual rate in the first quarter, together with expectations of continued slow growth this year, indicate that a robust jobs recovery remains elusive.”

Labor underutilization goes well beyond the 12.5 million people actively looking for work and who, therefore, meet the official definition of unemployment, Stone says.  Another 2 million or so are characterized as “marginally attached to the labor force” because they have indicated they want to work; have looked in the last year but not in the most recent four weeks because they are discouraged about their job prospects; or face other barriers to searching or taking a job such as family responsibilities or transportation difficulties.  Finally, about 8 million other people want to work full time but have only found part-time work.

“Though unemployed and underemployed workers bear the brunt of a long economic slump like the one we‘re experiencing, the economy’s long-term growth prospects are hurt as well,” Stone says. “That should weigh more heavily than it apparently does in policymakers’ deliberations over how quickly to reduce budget deficits and how to achieve the Federal Reserve’s dual mandate to keep inflation in check (it is right now) and to promote strong economic growth and employment (both of which are weak).”

 

Scott Nance is the editor and publisher of the news site The Washington Current. He has covered Congress and the federal government for more than a decade.

Related posts:

Bookmark and Share

Tagged , , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

Comments are closed.