Source: Calculated Risk.
There were 115,000 payroll jobs added in April, with 130,000 private sector jobs added, and 15,000 government jobs lost. The unemployment rate declined to 8.1%. U-6, an alternate measure of labor underutilization that includes part time workers and marginally attached workers, was unchanged at 14.5%.
Friday’s jobs report for April was even more disappointing than March. Employers added only 115,000 new jobs, down from March’s number (the Bureau of Labor Statistics revised the March number upward to 154,000, but it’s still abysmal relative to what’s needed). At least 125,000 new jobs are necessary each month just to keep up with an expanding population of working-age people.
That means the hole is getting even deeper.
…Most of the job gains in April were in lower-wage industries — retail stores, restaurants, and temporary-help. That means average wages continue to drop, adjusted for inflation — continuing their long-term decline. Most of the new jobs that have been added to the U.S. economy during this recovery have paid less than the jobs that were lost during the downturn.
What does all this mean? Together with other recent data showing slower economic growth during the first quarter of this year, it’s safe to say the economy has stalled.
From Calculated Risk:
- There are a total of 12.5 million Americans unemployed and 5.1 million have been unemployed for more than 6 months.
- According to the BLS, there are 5.1 million workers who have been unemployed for more than 26 weeks and still want a job.
- There are now more private sector jobs than when President Obama took office.
- The public sector is continuing to hemorrhage jobs.
- The participation rate decreased to 63.6% from 63.8% (a new cycle low).
The Bush administration crashed our economy so badly that even though the Obama job creation record is better than Bush’s, it’s still not enough. Most new jobs are low-paying, and the middle class just doesn’t have the spending power to help with the recovery. The rich are doing better than ever, but this also does not help the economy – instead, it sets the conditions for the next bubble and financial sector meltdown.
UPDATE: Dean Baker reminds us that the collapse of the housing bubble stuck the American consumer with $8 trillion in lost wealth, and this continues to depress demand.
UPDATE: Presidential candidate Willard (“Mitt”) Romney says “We should be seeing numbers in the 500,000 jobs per month.” Of course, that has only happened four times in 50 years.
UPDATE: Robert Reich tweets:
“Rom says unemp shld be 4%. I was Sec of Lab last time it was 4%. We got there by raising taxes on rich and investing in ed and infrstructre.”