The survey says:
Total nonfarm payroll employment rose by 165,000 in April, and the unemployment rate was little changed at 7.5 percent, the U.S. Bureau of Labor Statistics reported today. Employment increased in professional and business services, food services and drinking places, retail trade, and healthcare.
There were huge revisions (positive) in last month's report and the combination drove the market higher, as both were "much better than expected." Is this justified?
That's an actual uptick -- albeit right on schedule (spring hiring). I can't find a problem there, and, on schedule, we have an uptick in the employment rate as well:
As for how much trouble we're in, we are still bouncing around under population requirements. So while this report is "good," it's not strong.
Now for the bad news:
The average workweek for all employees on private nonfarm payrolls decreased by 0.2 hour in April to 34.4 hours. Within manufacturing, the workweek decreased by 0.1 hour to 40.7 hours, and overtime declined by 0.1 hour to 3.3 hours. The average workweek for production and non-supervisory employees on private nonfarm payrolls decreased by 0.1 hour to 33.7 hours.
This is a problem. If we look at the employed figure of 143,724,000 people, a drop of 0.2 hours is a full-time equivalent decrease of 1/2%. Applied to the employed population, this amounts to an imputed economic decrease of 718,620 jobs. That is, the loss of work-week hours of just 0.2 has the same economic impact as firing 700,000 people.
There is a huge problem coming this year and into next in this regard as the trend of cutting hours back to get under Obamacare limits is picking up steam and will continue. Do not underestimate the economic impact of those hours-worked changes -- you'd have to post a 700,000-plus jobs figure to offset just this one month's change in the hourly workweek.
You'll be told this is a "good report" -- and it is, on the surface. But I bet not one of the talking heads on CNBC runs the math on what the workweek means in terms of economic impact. You heard it here first. Later this summer and into the fall when the jobs report continues to post mid-100,000 numbers but consumer spending collapses (at a rate that is roughly identical to when we're losing 600,000-700,000 jobs a month), and people are scratching their heads trying to figure out why it's happening as the stock market crashes, you will be one of the few who understands what has happened and why.