Earlier in the week, the consensus estimate of the Jobs Report released this morning was that 225 thousand jobs were created in March. Over the last few days, it drifted down to 200 thousand. When the actual number of 216 thousand was released, the futures market had a nice pop-up. It should be another good day in the market. Hopefully, the 13 million people looking for jobs will find one soon!
Also, the unemployment rate dropped from 8.9% to 8.8%. That's a long way from the high of 9.8% but even further from full employment, when 5-6% is unemployed. The "real" level of long term unemployed, which includes those who have given up decreased from 16% to 15%, another good sign.
The surprising thing is that the labor force participation rate is barely changing. Usually, the unemployment rate rises slightly before dropping over the long term, as those who have given up then try to return to the labor force. For whatever reason, those who have given up still don't believe there are any jobs out there for them. The conservative argument blames this on unemployment compensation, but this applies to those people who have already exhausted their benefits and have given up. Maybe, they've gone to live with relatives or friends. Many may be under-employed, doing a menial job. Some may have qualified for welfare. Some must be homeless. If you think about how long this recession has been, since Q3 of 2007, it is a small wonder that those who have been most affected for so long, now have the least faith in the American dream, and that's sad! Imagine the emotional damage of being unemployed for three years . . .
There has been some press coverage recently of discrimination against the long-term unemployed. While I understand the reasoning of employers, I worry that we are creating a permanent under-class of long-term unemployed. That would be so un-American! The good news is that monthly job growth will continue to increase, and we might be able to avoid having a permanent under-class.
