The Obama administration and the press (though I might be repeating myself) got their desired toplines of 288,000 jobs added and an unemployment rate of 6.3%, both on a seasonally-adjusted basis, in April. A closer look at the numbers show that things are not as they seem.
The first contradiction involves the number of jobs added. While the establishment survey claims there were 288,000 jobs added, the household survey claims there were 78,000 fewer people employed in April than in May. That divergence of 366,000 tells me that at least one of those numbers must be wrong.
Those 78,000 fewer employed were among the stunning 806,000 fewer people considered to be part of the workforce, defined as those working plus those who looked for work in the 4 weeks prior to the survey in mid-April. That drove the labor-force participation rate down from 63.18% to 62.81%, which, to the nearest tenth of a percent, is tied with December 2013 and October 2013 as the lowest since March 1978. It also drove the employment-population ratio down from 58.94% to 58.87%, which, to the nearest tenth, is lower than every month between January 1984 and December 2009.
That leads me to the second contradiction, one that actually has been a long-standing feature of the Obama economy – those under 55 continue to take Todd Rundgren’s advice and bang on the drum all day instead of working, while those over 55 take up some of the slack. Out of the age groups for which seasonally-adjusted numbers are available (16-19, 20-24, 25-54, and 55-and-older), only the elders had more people employed (174,000) or in the workforce (158,000) in April, and they also had the only positive growth in the labor-force participation rate (+0.12 percentage points to 39.93%) or employment-population ratio (+0.14 percentage points to 38.06%).
Those between the ages of 25 and 54 suffered the biggest drop in the percentage of employed, with the 209,000 fewer employed reducing the employment-population ratio among that age group by 0.19 percentage points to 76.46%. To the nearest tenth, that is lower than it has been every month between January 1985 and March 2009.
Those between the ages of 20 and 24 gave up looking for work by the largest percentage, with the 322,000 fewer participants dropping the labor force participation rate among that age group by 1.47 percentage points to 70.21%. The last time it was that low was May 2013, and before that April 1972.
A special mention must be made for the participation rate among 16-19 year olds. At a meager 33.2%, it is the first time since records began in 1948 that fewer than a third of teenagers even tried to work.
The final contradiction involves those who work part-time, defined by the Bureau of Labor Statistics as those who usually work fewer than 35 hours per week. While the household survey claims 398,000 fewer people worked part-time in April, the establishment survey claims the average private-sector workweek was unchanged at 34.5 hours, the average production/non-supervisory workweek was unchanged at 33.7 hours, and the average amount of overtime worked by non-supervisory workers in the manufacturing sector declined by 0.2 hours to 4.4 hours.