A Very Pleasant Payrolls and Unemployment Surprise for April
The Labor Department is out with the April Employment Situation Report, and it is a report that the market will view positively. Some are going to question the unemployment rate because it fell yet again to 7.5% from 7.6%. Nonfarm payrolls rose by a better-than-expected reading of 165,000 in April.
Bloomberg was calling for 153,000 in payrolls and Dow Jones was calling for 148,000 in payrolls. Both Bloomberg and Dow Jones were calling for unemployment to remain flat at 7.6%. Another win is that the private sector payrolls came in at 175,000, as expected by Bloomberg. The Bureau of Labor Statistics said, "Employment increased in professional and business services, food services and drinking places, retail trade, and health care."
March also was revised to better than it had been forecast before. The private sector was shown to have added 154,000 jobs in March, versus the prior report of 95,000. The number of long-term unemployed (jobless for 27 weeks or more) also fell by some 258,000 to about 4.4 million, and their portion of the unemployed fell by 2.2 percentage points down 37.4%.
Today's news should be welcomed by investors because we and others had been ratcheting down expectations for the payrolls data. The unemployment rate has declined in most cases due to a lower workforce participation rate, but that was not the case this time. The civilian labor force participation rate was unchanged from the prior month and was listed as 63.3% in April.
The equities markets are taking a neutral stance so far this morning. We have S&P 500 futures down just about 1.50 and DJIA futures are up about 10 points.
Filed under: 24/7 Wall St. Wire, Economy, Labor Tagged: featured