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Wednesday, May 22, 2013
April's U.S. Jobs Report a Far Cry from Where We Need to Be
Tags: April jobs report, file for unemployment, jobs news, jobs report April 2012, jobs report May 2011, jobs report schedule, jobs report tomorrow, labor department jobs report
Expectations ahead of April's U.S. jobs report were that it could deliver some good news about the U.S. economy.
A robust number would have alleviated worries the economy is faltering the third year into a tepid recovery.
But that is not what we got.
The jobs report, released before the bell Friday, showed a net gain of 115,000 jobs, far fewer than the 160,000 expected by economists in a CNNMoney survey.
Friday's numbers follow the unsatisfactory 154,000 jobs added in March.
Some mild surprises: February and March job figures were revised upward, and the unemployment rate fell to 8.1%. Many had anticipated the rate to remain at 8.2%.
But overall the weak showing is alarming. It's a sign that the hiring pickup at the start of 2012 was only temporary.
Roger Altman, a deputy Treasury secretary in the Clinton administration, told Bloomberg News the monthly jobs report was "pretty disappointing."
"We need 200,000 to 250,000 jobs to really make this, or to illustrate that this is a healthy and strongish recovery," Altman, chairman and founder of Evercore Partners, said in an interview on Bloomberg Television. "We're nowhere near that."
U.S. markets reacted by sending stocks sharply lower on the open. The Dow was down more than 175 points by 12:45 p.m. EDT.
April's U.S. Jobs Report No Surprise
The uninspiring numbers came on the heels of last week's report on gross domestic product, which showed a steep drop in spending by businesses and government. The U.S. economy grew at an estimated pace of 2.2% in the first quarter of the year, according to the U.S. Commerce Department, a drop from 3% in the fourth quarter.
The GDP report is just another reason why companies are not adding to their workforce.
The Commerce Department revealed this week that consumer income ticked up 0.4% in March, while spending increased by 0.3%. But those numbers aren't as encouraging when you consider much of the spending increase resulted from higher gasoline prices.
When adjusted for inflation, spending eked up a measly 0.1%.
Despite the less-the-stellar numbers from various economic sectors, economists maintain the U.S. recovery will continue. But, they add, the economy is not showing much muscle.
Economists polled by The Associated Press expect growth to pick up this year, but not enough to make much of a dent in the high unemployment rate.
In a speech Thursday, John Williams, president of the Federal Reserve Bank of San Francisco said, "The outlook is for continued moderate growth. Nonetheless, we have nearly 4 ½ million fewer jobs today than five years ago."
While the overall U.S. economy and employment levels are better than they were at the start of the Great Recession, they still have miles to go before investors and economists breathe a sigh of relief.
Friday's dreary U.S. jobs report is just another sign of that.
Related Articles and News:
Tags: April jobs report, file for unemployment, jobs news, jobs report April 2012, jobs report May 2011, jobs report schedule, jobs report tomorrow, labor department jobs report
But that is not what we got.
The jobs report, released before the bell Friday, showed a net gain of 115,000 jobs, far fewer than the 160,000 expected by economists in a CNNMoney survey.
Friday's numbers follow the unsatisfactory 154,000 jobs added in March.
Some mild surprises: February and March job figures were revised upward, and the unemployment rate fell to 8.1%. Many had anticipated the rate to remain at 8.2%.
But overall the weak showing is alarming. It's a sign that the hiring pickup at the start of 2012 was only temporary.
Roger Altman, a deputy Treasury secretary in the Clinton administration, told Bloomberg News the monthly jobs report was "pretty disappointing."
"We need 200,000 to 250,000 jobs to really make this, or to illustrate that this is a healthy and strongish recovery," Altman, chairman and founder of Evercore Partners, said in an interview on Bloomberg Television. "We're nowhere near that."
U.S. markets reacted by sending stocks sharply lower on the open. The Dow was down more than 175 points by 12:45 p.m. EDT.
April's U.S. Jobs Report No Surprise
The lackluster U.S. jobs report was not a shock.
Recent labor market indicators prior to Friday's jobs report reflected notably slower labor demand growth and shorter work weeks. While employment growth continued in April, it did so at a markedly slower pace than in prior months.
Just 19% of firms reported hiring new workers, while 7% reported layoffs. In addition, the hours worked index dropped eight points to a negative 4.6, its first negative reading in eight months.
On Wednesday, payroll processor ADP's monthly report revealed that the private sector only added a paltry 119,000 jobs in April, appreciably below the 170,000 forecast, and the smallest gain since September 2011.
Employers also have gotten more adept at squeezing more manpower out of fewer workers over shorter hours. Hiring will only pick up when increased demand forces them to do so.
The uninspiring numbers came on the heels of last week's report on gross domestic product, which showed a steep drop in spending by businesses and government. The U.S. economy grew at an estimated pace of 2.2% in the first quarter of the year, according to the U.S. Commerce Department, a drop from 3% in the fourth quarter.
The GDP report is just another reason why companies are not adding to their workforce.
The Commerce Department revealed this week that consumer income ticked up 0.4% in March, while spending increased by 0.3%. But those numbers aren't as encouraging when you consider much of the spending increase resulted from higher gasoline prices.
When adjusted for inflation, spending eked up a measly 0.1%.
Despite the less-the-stellar numbers from various economic sectors, economists maintain the U.S. recovery will continue. But, they add, the economy is not showing much muscle.
Economists polled by The Associated Press expect growth to pick up this year, but not enough to make much of a dent in the high unemployment rate.
In a speech Thursday, John Williams, president of the Federal Reserve Bank of San Francisco said, "The outlook is for continued moderate growth. Nonetheless, we have nearly 4 ½ million fewer jobs today than five years ago."
While the overall U.S. economy and employment levels are better than they were at the start of the Great Recession, they still have miles to go before investors and economists breathe a sigh of relief.
Friday's dreary U.S. jobs report is just another sign of that.
Related Articles and News:
- Money Morning:
The March Unemployment Report: Here's the Real Story with the U.S. Employment Rate - Money Morning:
How Political Spin Skewed the U.S. Jobs Report - MSNBC:
Jobs report may show if recovery is just a mirage - Bloomberg:
U.S. April Dallas Fed Business Outlook Report - USA Today:
Businesses add only 115,000 jobs in April; unemployment 8.1%
Tags: April jobs report, file for unemployment, jobs news, jobs report April 2012, jobs report May 2011, jobs report schedule, jobs report tomorrow, labor department jobs report
