May 08, 2015
The Department of Labor reported the economy created 223,000 jobs in April. This is disappointing since the already weak March number was revised down by 41,000 to 85,000. Since the March number was held down by unusually bad weather, it was reasonable to expect more of a bounceback in April. With the downward revision, the two month average is 154,000.
There were few sectors showing much strength in the month. Professional and business services added 62,000 jobs, construction added 45,000 after a reported loss of 9,000 in March and health care added 45,200 jobs. Restaurants added 26,000 jobs. Manufacturing employment has essentially gone flat, adding just 1,000 jobs. Employment in the sector is up by just 4,000 since January, and because the average workweek has declined, the index of aggregate weekly hours in manufacturing is down by 0.5 percent from its January level. This is consistent with the data showing a rise in the trade deficit due to the stronger dollar.
The news is a bit better in the household survey. The unemployment rate edged down slightly to 5.4 percent. The number of involuntary part-time workers fell by 125,000 from the March level and is now down by 880,000 from its year ago level. Meanwhile the number of people who choose to work part-time rose by 320,000 from March and is up by 1,140,000 (@ 6 percent) from its year ago level. This is likely due to the increased flexibility offered by the Affordable Care Act.
In spite of this good news, the report is not encouraging.
