Kevin Glass

The Bureau of Labor Statistics released their report on the employment situation in April today, and it's largely good news: 288,000 jobs were added, the best month for jobs in the last two years, and the unemployment rate dropped from 6.7% to 6.3%.

Beyond the topline numbers, there are a few caveats. The number of people unemployed "part time for economic reasons" - in other words, people with part-time jobs who would rather have a full-time job if it were available - was unchanged; and over 800,000 people left the labor force, which helped drive the drop in the unemployment rate. Nonetheless, strong job growth is reflected in the broader U-6 unemployment rate, which takes into account underemployment and discouraged workers. The U-6 rate dropped from 12.7% to 12.3%.

Here's a visualization of the drop in the labor force:

via Matthew Phillips

An important caveat is that jobs reports are always revised later. This one could get revised downward and should temper any cautious optimism. This report's revisions, however, were both positive; BLS reported that their estimates for February and March were too low, and that they now estimate that 36,000 more jobs were added in those two months than previously estimated.

UPDATE: The revisions to the jobs report mentioned in the last paragraph are only revisions to the employer surveys, not to the population surveys. This is important for estimating unemployment rates, for example.

Furthermore, as Conn points out, the combination of drop in labor force and job growth means that there are actually fewer Americans with jobs now than previously:

Kevin Glass
