I was originally going to title this post “Good News”. Then I read the article and revised my opinion:
(Reuters) – U.S. job growth increased at its fastest pace in more than two years in April and the unemployment rate dived to a 5-1/2 year low of 6.3 percent, suggesting a sharp rebound in economic activity early in the second quarter.
Nonfarm payrolls surged 288,000 last month, the Labor Department said on Friday. That was the largest gain since January 2012 and beat Wall Street’s expectations for only a 210,000 increase.
The unemployment rate tumbled 0.4 percentage point, touching its lowest level since September 2008. The Labor Department attributed the decline to a drop in the number of unemployed people reentering the labor market as well as a fall in new entrants into the labor force.
The emphasis is mine. Don’t get me wrong. I rejoice in the 288,000 added to payrolls. If we kept that up every single month, those who’s who’ve been unemployed for so long could come back to work in just three or four years. If we kept that up every single month.
But the unemployment rate dropping because people aren’t even bothering to look isn’t good news.
When I read the article’s headline I wondered how a sharp April increase could be reconciled with the GDP figures we saw earlier in the week and now I know. They’re completely consistent and they’re not particularly encouraging. Better than nothing? Yes. But not nearly good enough.