One month of jobs numbers tells us very little about the economy’s direction. But with the April jobs numbers released Friday morning we have back to back months of powerful gains. The Labor Department reports that April job growth was 290,000. The original number for the month of March had been 162,000 jobs gained; it was revised up to 230,000 jobs. Now we have the April number, which economists had expected would only be modestly above the pre-revision March number, say about 180,000. Today’s report blows that away.
True, there are clouds aplenty around the April jobs gains. One big one is the fact that long-term unemployed hangs high at 17.1%. Also, the key number for public consumption, the unemployment rate, actually inched higher, to 9.9%, a reversal of the declines over the last few months. This number is not as meaningful as the job growth number (it’s calculated differently) but nor is it something to dismiss as it affects consumer confidence. Finally, the April number is pumped up a bit by 66,000 hires to help with the U.S. Census. Those jobs will not last long, so it is not engine of sustainable growth for the economy. That said, today’s numbers are just what the markets needed, a bit of good news. Now let’s see how long that keeps investors sated.