Nonfarm payroll employment rose by 290,000 in April; an encouraging development. 

While more jobs are preferable to less, claims of progress resolving the employment depression are greatly exaggerated.   

Unemployment and Stimulus Spending

The April data further demonstrates the failure of stimulus spending to achieve its stated purpose.  The Unemployment Rate is now 2.3% above levels asserted to justify the incremental expenditure and debt. 



As stimulus funding is exhausted later this year, federal, state and local governments will be required to cut employees financed by the unsustainable program (an action which should have take place 18 months ago).  The net, private sector, employment benefit will also soon reverse itself.  Job losses from waning stimulus combined with declining Census headcount make it unlikely that the employment situation will improve in the second half of 2010.

Credit for Participation

The Unemployment Rate rose even as jobs were created because the labor Participation Rate increased.  People returning to the work force is a positive.  But the Unemployment Rate is no longer being subsidized by declining participation.   As such, Unemployment may continue to increase despite net job gains.



If Employment is Improving Why is Underemployment Getting Worse?

For three months the U-6 measure of Underemployment has been rising.  I am sure that Census workers are happy to be temporarily employed by the Government, but the inclusive measure of unemployment/underemployment continues to worsen.



Job Gains and Rising Participation Has Not Benefited the Discouraged

The number of people who have given up looking for work because they believe no jobs are available provides a sobering perspective on the employment environment.