BLS Report: Steady Spring Job Market Or Unemployment Disaster?

Total nonfarm payroll employment rose by 165,000 in April, and the unemployment rate was little changed at 7.5%, the U.S. Bureau of Labor Statistics reported Friday, May 3, 2013.

Employment increased in professional and business services, food services and drinking places, retail trade, and health care.

The unemployment rate, at 7.5%, was changed little in April but has declined 0.4 percentage points since January.

The number of unemployed persons, 11.7 million, was also little changed. Unemployment has decreased by 673,000 since January.

Pro-business research group the Conference Board was happy with today’s employment report:

With an increase of 165,000 jobs in April, and following the significant upward revisions for February and March, the job market looks better than expected despite the sequester or issues like the rising cost of providing health care benefits.

Manufacturing, however, is basically flat outside of auto assembly.

The big story is gain in the service sector, in addition to the secular gains in health and education.

Final demand is relatively weak, so hiring in this sector could well represent some catch up – business finally hiring workers they have long needed but were leery of hiring if the economy was going to buckle under the ‘fiscal drag’ or the sequester.

The concern should be that sustaining this pace of hiring might prove difficult through the spring and summer months, as other key data signal that another spring swoon appears to be underway

Consumer spending power is rising slowly and sentiment is still very weak.

Kathy Bostjancic, Director of Macroeconomic
Analysis, The Conference Board

Source: The Conference Board

http://www.conference-board.org/press/pressdetail.cfm?pressid=4804

The liberal Economic Policy Institute sees little progress in the job market:

The jobs report released today by the Bureau of Labor Statistics showed that the labor market added 165,000 jobs in April and that the unemployment rate hardly budged, moving just six-hundredths of a percentage point, from 7.57% to 7.51%.

This is a classic “hold-steady” report—there were enough jobs to keep the unemployment rate stable, but not much more.

In good times this would be fine, but at a time of persistent economic weakness, it represents an ongoing disaster.

We need 8.7 million jobs to get back to a healthy labor market.

The average growth rate so far in 2013 is 196,000 jobs a month; at that rate, it will take more than five years to return to the prerecession unemployment rate.

Despite more than three years of job growth, the labor market still has a deficit of 8.7 million jobs, and the lack of demand for workers means unemployment remains high, labor force participation is low, and wage growth for people with jobs is sluggish.

http://www.epi.org/publication/time-persistent-economic-weakness-todays/

Within the mix of this decidedly mushy jobs report is the rising specter of the federal budget sequester. Any progress that might be made on the jobs front is will be erased if the Republican in Congress continue to hold the federal budget hostage, administration officials warn

“But let us not mistake a report that exceeds our expectations with unequivocal economic success,” said acting labor secretary Seth D. Harris.

“The difference between a moderate jobs report and an excellent report is the sequester,” Harris said. “These misguided, arbitrary budget cuts are putting the brakes on an economy that is gaining momentum in the private sector – just when we need to hit the gas.

“Because of the sequester, we are not creating the abundance of new jobs that will put everyone who wants to work back on the job and end the cruel game of economic musical chairs that leaves so many hard-working people out of work when the music stops.”

Among the major worker groups, the unemployment rate for adult women, 6.7%, declined in April, while the rates for adult men, 7.1%, teenagers, 24.1%, whites, 6.7%, blacks, 13.2%, and Hispanics, 9%, were unchanged.

The jobless rate for Asians was 5.1%, little changed from a year earlier.

In April, the number of long-term unemployed, those jobless for 27 weeks or more, declined by 258,000 to 4.4 million. The long-term share of the unemployed declined by 2.2 percentage points to 37.4%.

A quarter of American workers are stuck in bad jobs.

During the past 12 months, the number of long-term unemployed declined 687,000. Their share has declined by 3.1 percentage points.

April’s civilian labor force participation rate was 63.3% unchanged during the month but down from January’s 63.6%.

The employment-population ratio, 58.6%, was unchanged and has shown little movement, on net, in the past year.

In April, the number of persons employed part time for economic reasons, sometimes called involuntary part-time workers, increased by 278,000 to 7.9 million, offsetting a decrease in March.

These workers were employed part time because their hours had been cut or because they were unable to find a full-time job.

In April, 2.3 million persons were marginally attached to the labor force, unchanged from last year.

These people were not in the labor force, but wanted and were available for work, and had looked for a job sometime in the prior 12 months.

These job seekers were not counted as unemployed because they had not searched for work in the four weeks preceding the survey.

Among the marginally attached, there were 835,000 discouraged workers in April, down 133,000 from last year.

Discouraged workers are persons not currently looking for work because they believe no jobs are available for them.

The remaining 1.5 million persons marginally attached to the labor force in April had not searched for work in the four weeks before the survey for reasons such as school attendance or family responsibilities.

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