The employment report for April came out at 8:30 and the results were not good. The economy created only 115,000 jobs, a figure well short of the number needed to even keep up with population growth. The economy is losing steam, and we may soon start hearing the double dip crowd warning about an impending recession. For the moment, such a warning seems overblown, but the American economy is definitely moving in the wrong direction at the moment.
In all of this, however, the unemployment rate got to 8.1%, a figure which has not been seen for three years. How can that be, you might ask. Job creation does not keep up with population growth, but unemployment rates improve. The answer is simple: 342,000 people supposedly left the labor force in April. Let me say that again so that it will sink in: 342,000 WORKERS DROPPED OUT OF THE LABOR FORCE IN APRIL ACCORDING TO THE FEDERAL GOVERNMENT!!!!! But this, of course, gives rise to a more troubling question -- Does anyone believe this statistic? Really? More than a third of a million folks just decided in April that working was just too much for them and dropped out? Again, really?
The likelihood that in the current economic condition of the USA there was a group of people this large who left the labor force is essentially ridiculous. But wait, the whole thing gets worse, if that is possible. The number of jobs created (115,000) comes from one survey while the unemployment rate comes from another. In the second survey, the number of jobs in the USA actually is said to have declined, but due to the big drop in the workforce, the unemployment rate went down too. I really wonder if these workforce figures were manipulated to get a satisfactory unemployment rate. I do not like even to consider such a thing, but the numbers for April lead me inevitably to that question.
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