Friday, May 08, 2009
The Labor Department reported that fewer jobs were lost in April than in any month since last October, but that the unemployment rate continues to rise sharply, an indication that laid off workers are finding it increasingly difficult to find new employment.
Nonfarm payrolls fell 539,000 in April after losses of 681,000 in February and 699,000 in March. Total revisions for the two prior months were -66,000 as the February and March data were revised downward from 651,000 and 663,000, respectively.
Over the last six months, a total of 3.9 million jobs have been lost and, since the recession began in December of 2007, the U.S. economy has shed 5.7 million jobs.
The jobless rate jumped from 8.5 percent in March to 8.9 percent in April, reaching its highest level since the September 1983 mark of 9.2 percent and the total number of unemployed now stands at 13.7 million, up from 13.2 million in March. The post-WWII high for unemployment came in December of 1982 at 10.8 percent.
If laid off workers who have stopped looking for a job are included in the unemployment figure along with those currently employed but settling for part-time work, the jobless rate would have been 15.8 percent, a 15-year high.
While job losses may have peaked with January's decline of 741,000 (though, next year's benchmark revisions to the payrolls data could radically change this), the jobless rate is likely to continue higher until the economy begins to improve and companies are more willing to hire.
One part of the economy that was hiring last month was the government where total payrolls rose by 72,000. This was driven by a the addition of some 140,000 temporary workers that will begin work on the 2010 census. A total of 1.4 million workers will be hired over the next year to conduct the population count that happens every ten years.
Elsewhere, job losses continued, but at a slightly slower pace than in previous months, manufacturing leading the way down with a decline of 149,000 and the trade, transportation, and utilities category not far behind at minus 126,000.
The birth-death model added a total of 226,000 jobs in April, a new high for the year.
Since this data is used to adjust the raw totals prior to seasonal adjustments, you can't just subtract it from the headline seasonally adjusted data to determine its impact, but it is important to note that the entire 65,000 increase in professional and business services payrolls (which was then seasonally adjusted to -122,000) was contributed by the birth death model - it's hard to imagine that there were so many new businesses formed in April.