April 2008 Jobs Report and Wages

Here are the job market and compensation numbers for April 2008 (based on the job report):

Net loss of 20,000 jobs in the month (revised to a loss of 28,000)

  • 4th consecutive month of labor reduction
  • March had a loss of 81,000, so a loss of 20,000 is moving in the right direction
  • Analysts expected a loss of 75,000 jobs for April
  • 260,000 jobs have been lost so far in 2008 (first four months of the year)
  • That is an average of 65,000 a month
  • During the 2001 recession the average was 121,000 jobs lost a month and in same period in 1990 it was an average of 123,000
  • But it was a jobless recovery from 2001, so companies might already be lean in comparison to those times
  • Strangely, the corresponding household survey that includes self-employed individuals saw a net increase of 173,000 people joining the workforce in the month (this is a volatile survey).

Unemployment rate moved  down to 5.0%

  • Economists expected the rate to increase to 5.2% rather than a drop to 5.0%
  • Part time workers increased to 306,000. These are people that want full time jobs.
  • This improves the unemployment rate, but reflects a weak job market
  • This is the highest number since November of 2005
  • Unemployment length increased in April to 9.2 weeks from 8.1 weeks in March
  • Taking into consideration those no longer looking for work and added to those looking, that number is 9.2% – a 0.1% rise from March
  • Those not looking for work rose from 399,000 last year to 412,000 this April
  • Those jobless for at least 27 weeks, AKA long term unemployed, rose last month to 17.8% from 16.7% in March
  • The 12 month average unemployment now stands at 4.5%
  • An employment number of 6% isn’t expected this year, compare that to similar situation: 1992 was 7.8% and 6.3% in 2003


Wages increased a penny to $17.88

  • Smallest increase in almost two years
  • The rate of growth of wages has dropped since the end of 2006
  • Over the last year, average weekly wages are up 3.1%
  • Costs of food and energy are canceling out that improvement
  • Inflation over the same period (12 months) is 4%, indicating pay isn’t staying in line
  • Companies are reducing work hours (trying to avoid layoffs until economy picks up)
  • 33.7 weekly hours is a drop from 33.8 in March (correlating to the increase in part time work)
  • The number of part time workers is 5.2 million.
    • It was 4.9 million in March
  • As a percentage of the population, part time workers are at their highest amount since 1995
  • The average weekly pay for normal workers is $602.56 (adjusted for inflation).
    • That is down $3.55 in April (this is for 80% of the population)
  • Because of the narrow increase in pay and the reduced number of hours worked, the weekly wages suffered its biggest drop in almost two years

Specific Segment Job numbers:

  • Manufacturing loss 46,000 jobs in April
    • 326,000 in the last year
  • Construction loss 61,000 jobs
  • Retailers loss 26,800 jobs
  • Health Care gained 37,000 jobs
  • Professional and business services (architects, accountants, and management consultants) added 39,000 jobs
    • This number is questioned however, and expected to be revised
    • There was a loss of 44,000 last month
  • The financial sector added 3,000 jobs
    • This is after 8 months of losses due to the credit situation
  • Restaurants and bars employed and additional 18,000 people
    • This is often an indication of an improving economy since people are eating out more often
  • 29,000 total jobs were lost in the private sector
    • It is the 5th straight month of losses outside of government payrolls

Question:

Is this report the tipping point back to a positive economy or is it just a fluke month of reports?

Job Report Statistics Index Page

About benleeson
My name is Ben Leeson. I currently work for a large financial company in IT. I went to school at Marist College in Poughkeepsie, NY. I graduated with a B.S. in Business Administration concentrating in HR. Professor William Brown taught me and I enjoyed his classes; even acquiring an appreciation for just about all things HR. I didn’t pursue a job in that field after college but I’ve kept up with it. This blog will further my fascination with all things HR. I hope to grow my knowledge of the area through thoughtful writings and spirited feedback. I will attempt to have a fairly routine style so anyone reading can come to expect certain segments. Please excuse my incorrect grammar and occasional misspelling.

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