The Real News
Submitted By Todd on May 7th at 12:12pm
Which is the real news?Is it the good news that the economy created 290,000 new jobs last month, or the bad news that the unemployment rate jumped to 9.9%?
More confident employers stepped up job creation in April, expanding payrolls by 290,000, the most in four years. The jobless rate rose to 9.9 percent as people streamed back into the market looking for work.Actually, it wasn't the economy that created all those jobs. There was lots of government hiring, and stimulus dollars, at work.
The hiring of 66,000 temporary government workers to conduct the census helped overall payroll growth last month. However, private employers -- the backbone of the economy -- boosted jobs, too. They added a surprisingly strong 231,000 positions last month, also the most since March 2006, the Labor Department reported Friday.It's obviously better to create jobs than to lose them...
"Clearly companies have a newfound confidence in the future of the economic recovery and on the part of their own business prospects," said Joel Naroff, president of Naroff Economic Advisors. "The broadbased job gains are an indication that businesses are feeling more comfortable about expanding their work forces," he said.Under the radar workers who've decided the time is right to crawl out of hibernation push the unemployment rate up - that's real too!
The unemployment rate rose from 9.7 percent in March to 9.9 percent in April, mainly because 805,000 jobseekers -- perhaps feeling better about their prospects -- resumed their searches for work.So the real news is mixed - there are some good signs, and if the good signs continue in the face of an unsettled international economic environment, the good news will eventually turn around the bad news.
Many economists have predicted the unemployment rate would rise as people come back into the labor force. The jobless rate hit 10.1 percent in October, a 26-year high. The rate could climb back up to the 10 percent range in the months ahead, Naroff said.As fragile as things are, the real news is that things are shaky.
Friday's employment report sketched out a picture of a healing jobs market and an economy picking up momentum in the early spring. The improvements, however, were taking place before the stock market plunged this week on concerns that the European debt crisis could spread. There are fears the crisis could make companies more cautious about hiring in the future, economists warned.Watch out.
Many economists think it will take until at least the middle of the decade to lower the unemployment rate to a more normal 5.5 percent to 6 percent.