April was not a month of promise for the job market as the increase in nonfarm payroll was only 115,000, much less than expected, but the unemployment rate dropped to 8.1% from 8.2%. The month’s projection by the Dow Jones Newswires was at 168,000, according to The Wall Street Journal.
The unemployment rate, released today by the Bureau of Labor Statistics, has dropped a whole percentage point in the past eight months with nonfarm payroll employment increasing by the minimal amount of 63,250 per month. The gains have been minimal in the past two months in comparison to the first two months of the year. December to February saw an average gain of 252,000, compared to March and April’s 134,500.
April’s marginally attached labor force, those available for work but hadn’t searched for a job in the previous four weeks, is still at 2.4 million – unchanged from March. It had dropped by 200,000 from February to March. The discouraged workers in the marginally attached labor force increased by 103,000 to 968,000 from March to April.
Much, if not all, of the credit for the unemployment rate decrease for April can be transferred to the increase of discouraged workers. With 103,000 new discouraged workers, the increase in employment is nearly statistically voided. The marginally attached labor force is not considered in the overall unemployment rate.
The discouraged sector of the workforce is made even more obvious by the civilian labor force participation rate which declined to 63.6% for April, the lowest it has been since 1981, according to US News and World Report.
-Dustin Bass, @dbass_cmn