You’re probably wondering, like many, how a weak economy only adds 115,00o new jobs and unemployment drops. It’s because more Americans are not participating in the labor force and they are not counted in the unemployment figures. The economy is not recovering, people are simply giving up and not looking for work.
From the NYTimes:
The United States had another month of disappointing job growth in April.
The nation’s employers produced a net gain of 115,000 positions, after adding 154,000 in March, the Labor Department said Friday. April’s job growth was less than economists had been predicting.
No mention of the 544,000 that dropped out of the labor force.
“We had a run of great numbers earlier in the year, and then we get a clear softening in the last couple of months,” said Ian Shepherdson, chief United States economist at High Frequency Economics. The slowdown, he said, could possibly be explained by unusually warm weather allowing more companies to hire earlier in the year than usual, or by higher gas prices. “If it’s the gas price effect, it ought to reverse, since wholesale gas prices dropped sharply over the last few weeks.”
American workers appear less optimistic.
The unemployment rate ticked down to 8.1 percent in April, from 8.2 percent, but that was not because more unemployed workers found jobs; it was because workers dropped out of the labor force.
The share of working-age Americans who are in the labor force, meaning they are either working or actively looking for a job, is now at its lowest level since 1981 — when far fewer women were doing paid work. The share of men taking part in the labor force fell to 70 percent, the lowest number since the Labor Department began collecting these data in 1948.