The job market remains a storm cloud on the horizon—the Labor Department announced this morning that employers added just 115,000 positions in April. The majority of that came from the private sector, the real engine of economic growth, as government job losses weighed on the private sector strength.
So while April marked the 16th straight month of jobs growth, this was below the critical 200,000 job creation level necessary for a strongly growing economy. And although the economy really didn’t create all that many jobs this month, the unemployment rate went down to 8.1%, largely due to folks dropping out of the workforce.
However, there was a bright spot in the report—job growth figures for March and February were revised upward, by a total of 53,000. And looking forward, many economists are cautiously optimistic about what the next few months may bring for the jobs market.
Supporting this thesis was yesterday’s good news on the initial claims front, as the advance figure for seasonally adjusted initial claims dropped 27,000 from the previous week’s revised figure of 392,000 to 365,000. This sharp decline was much higher than consensus estimates of a drop to 376, 000.
So despite the roller-coaster ride of the jobs market, I think we should continue to see a slow and steady improvement here in the months ahead.