Vincent Farnsworth 7:30 p.m., April 24
Economists Exult over Job Gains. Be Wary
Economists are rhapsodizing this morning (May 7) over April's rise in 290,000 jobs (224,000 after temporary Census workers are excluded). March job gains were revised upward to 230,000 from 162,000. The unemployment rate rose to 9.9% from 9.7% because, said the government, a flood of people entered the workforce. Economists are downplaying the bad news: the underemployment rate, which includes people who can only find part-time jobs and those who have been too discouraged to look for a job in the last four weeks, rose to 17.1% from 16.9%. Of the 15.3 million unemployed, a record 45.9% have been out of work more than half a year. The average workweek rose only 0.1 hour to 34.1 hours. In a healthy economy, this number is 37 hours, according to MarketWatch.
Today's report, in my own opinion, simply does not jibe with Wednesday's report of private sector employment by Automatic Data Processing. This report had private sector jobs rising only 32,000. One statistic that bothers me is the government's birth/death adjustment model. This is a computerized estimate of jobs created by small business that are not captured in standard reporting procedures. Again, this is a computer ESTIMATE -- it is not a count of actual jobs. The government estimated that 188,000 jobs uncounted jobs were created by small business in April -- larger than anything for many months. For example, the March number was 81,000. The Automatic Data Processing report indicated that of the 32,000 job gains in April, a mere 1,000 were in small businesses. Although this is not an apples to apples comparison, admittedly, those two numbers do not add up.