Saturday, May 14, 2011

April's Unemployment Report is Positive but Black and National Rates Rise

April unemployment rises: Black unemployment up 4%; National rate 9%

The unemployment report was pretty positive with a couple of bad areas. The number of non-farm payroll jobs increased by 224,000 with growth in the service industries and manufacturing. The bad news was the Black unemployment increased by 4% from 2.77 million to 2.88 on a seasonally adjusted basis. The figure was a 2% increase on a non-adjusted basis. The national rate also increased to 0.1% to 9.0% as more people started looking for jobs.

There was also good news on the long-term unemployed (out of work for more than 26 weeks). Their numbers dropped by 283,000 to 5.8 Million. Long term unemployed are 43% of the total unemployed.

The number of part-time workers for economic reasons was unchanged at 8.6 Million. These are people who would like full-time work but cannot find it. Marginally attached workers stayed around 2.5 million. These are people who have looked for work in the past 12 month but are not counted as part of the labor force. If they were included in the labor force, unemployment rate it would be 1.4% higher: 10.4%. A pretty sneaky way of hiding some of the unemployed.
The number of discouraged worked dropped significantly year-to-year. Last April there were 1.2 million. Currently there are 989,000 discouraged workers, a 17% drop. Discouraged workers have stopped looking for work because they believe no work is available for their skills.

Establishment Data
Non farm Payrolls increased by 244, 000. The private sector added 268,000 jobs which were reduced by government reductions. Retail trade stores added 57,000, business and professional services added 51,000, health care added 37,000 and manufacturing added 29,000.

Temporary help is a closely watched, bell-weather category. It grows during a recession as employers are unwilling to make the investment of hiring long term employees. When the economy picks-up, the demand for temporary help drops. Lately, as employers use of “temps” has changed, temporary help has stayed strong.
Temporary help was flat meaning that employers were hiring rather than using temporary help services.

Construction was also unchanged. Construction employment is also closely watched as an economic indicator. Construction employment has been depressed since the collapse of the housing “bubble” in 2007.

And finally some upward revision for past non farm payroll reports. The February new job creation was revised up from 194,000 to 235,000 and March was revised up from 216,000 to 221,000.

ADP reported 179,000 new jobs were added.

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