Economy Watch: Hiring Takes a Dip in April
- May 07, 2012
The headline numbers for employment were an increase of 115,000 in April and a small drop in the unemployment rate for the month, to 8.1 percent. The April gain in new workers was down from the 154,000 hired in March, though the March total represented an upward revision from the initial count of 120a,000, so it’s entirely possible that the April numbers will be nudged upward in the fullness of time.
Most private employers are continuing to trend upward when it comes to hiring, such as in retail employment (up 29,000 for the month), restaurants and bars (up 20,000) and health care (up 19,000). Manufacturing also continued to hire (up 16,000 for the month) as it has for some time now—a total of 489,000 jobs since the beginning of 2010, according to the Bureau of Labor Statistics.
In April, average hourly earnings for all employees on private nonfarm payrolls rose by 1 cent to $23.38. Over the past 12 months, average hourly earnings have increased by 1.8 percent, which isn’t terrible but not, as yet, quite enough to keep up with total or core inflation.
The labor force participation rate as measured by the BLS came in at 63.6 percent in April, the lowest in three decades. Discouraged workers telling the government that they’ve given up looking for work was one reason labor force participation has been falling (and one reason the unemployment rate dropped to 8.1 percent during April), but that wasn’t the only factor nor perhaps even the main one.
Though the economic difficulties since 2008 have accelerated the drop, the number of adults (16+ or older) in the U.S. workforce has actually been dropping since around 2000, after 1990s highs of around 67 percent. Many people are leaving the full-time labor force all together as they retire. The current participation rate is still much higher than during the 1950s and early ’60s, however, before women entered the workforce in massive numbers.
Euro election, unpredictable consequences
According to early predictions on Sunday night (Monday in Europe), French Socialist candidate François Hollande will be the next president of France, besting the incumbent Nicholas Sarkozy in the runoff election. The euro-zone crisis and economic malaise of that part of the world hasn’t been kind to incumbents: Sarkozy is the 11th zone leader to lose his office in recent years. Hollande is expected to be less sympathetic to putting the austerity screws on highly indebted euro-zone nations than his predecessor.
The parliamentary balloting in Greece, which was also on Sunday, was less clear-cut, as no party seemed to have won an outright majority. The two leading parties will probably form a coalition, and are expected to be less sympathetic to going along with the austerity conditions of the bailout than the predecessor government. In other words, all bets are off for Europe going forward (again).
Wall Street didn’t take the employment news particularly well, with the Dow Jones Industrial Average losing 168.32 points, or 1.27 percent. The S&P 500 was down 1.61 percent and the Nasdaq declined 2.25 percent.