The federal employment report for April was greeted Friday as if it were confirmation that a robust economic recovery is finally assured.
The Standard & Poor’s 500 stock index immediately rocketed to record territory above 1,600 and the Dow index nearly closed above 15,000.
The U.S. added 165,000 jobs in April, which only seemed like a good number because the consensus expectation had been lowered from around that level to about 140,000 in the week leading up to the report.
The best news in the report, though, was the dramatic upward revision of job creation numbers for February and March.
New jobs in February, already an excellent (by recent standards) 268,000, was revised to a breathtaking 332,000 jobs created.
Last month’s dismal 88,000 new jobs turned out to be, with better data, a much better 138,000.
In his comments on the report, Joel Naroff, president of Naroff Economic Advisors, tempered the market euphoria, calling the April increase “good but hardly great.”
With job gains in March and April lackluster as tighter federal fiscal policy took hold, we should “enjoy these employment data while we can but look to the future cautiously,” Naroff said in a statement.
The Economic Policy Institute, a liberal Washington think tank, went further, saying the job numbers “represent an ongoing disaster.”
For starters, the institute noted that the U.S. unemployment rate “hardly budged, moving just six-hundredths of a percentage point from 7.57 percent to 7.51 percent.” That slight shift was enough for the rounded headline figure to drop a tenth of a point to 7.5 percent, which most people erroneously think means something.
Next, the EPI pointed out that with the large upward revisions, the economy this year has averaged 196,000 new jobs per month. By that measure, 165,000 in April is a slowdown, pending a hoped-for revision.
Worse, even at that higher average monthly job creation rate, the U.S. economy would need more than five more years to return to the levels of employment that existed before the severe recession of four years ago.
Employment data for the southern Jersey Shore region also was released Friday and looked very good, at first.
Local seasonally adjusted unemployment rates for March, released by the Federal Reserve Bank of Philadelphia, were each a bit lower:
n Atlantic County — 13.1 percent in March, down from 13.4 percent in February and a high of 15.2 percent in November;
n Cape May County — 12.7 percent in March, down from 13 percent in February and a high of 14.4 percent in August;
n Cumberland County — 13.2 percent in March, down from 13.5 percent in February and a high of 14.8 percent in August.
The trend is clearly good, but the Philly Fed’s spreadsheet shows problems in March.
Each county had fewer people employed than the month before. Atlantic County employment fell from 115,900 to 115,400; Cape May County from 50,800 to 50,700; and Cumberland County from 59,300 to 59,00.
That means that the drop in the unemployment rates was probably driven by people giving up looking for work and thereby not being counted among the jobless.
That has been a problem nationwide. The EPI noted that the U.S. labor force participation rate in April remained 63.3 percent, the lowest in a generation.
The silver lining locally is that the shore and its tourism-dominated economy are bound to lag the recovery in the rest of the country, since people elsewhere need to start feeling better and vacationing here for our economy to improve.
So we’ll welcome the slow improvement at the national level and hope that it soon spreads to the local job market, which still remains one of the worst in the country.
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