South By North Strategies, Ltd.

CHAPEL HILL, NC (May 3, 2013) – The national labor market added in April 165,000 more jobs than it lost. The unemployment rate, however, was essentially unchanged from the previous month, as was the total number of unemployed Americans. Despite some improvements in key indicators in recent months, unemployment and underemployment remain elevated, while the pace of job growth remains subdued.

“April was the 31st-straight month of job growth recorded in the United States,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Over the past three months, the national economy has netted an average of 212,000 jobs, a pace that, while positive, is insufficient to drive unemployment down to pre-recessionary levels. More than 3.5 years into a recovery, the unemployment rate remains well above the December 2007 level of 5 percent.”

In April, the nation’s employers added 165,000 more payroll positions than they cut. Gains occurred entirely in the private sector (+176,000), while government employers eliminated 11,000 more positions than they added, owing chiefly to reductions by the federal government. Moreover, the payroll employment numbers for February and March underwent positive revisions; with the updates, the economy gained 470,000 jobs over those two months, not the 356,000 positions previously reported.

Within the private sector, payroll levels rose the most in the professional and business services sector (+73,000, with 59.3 of the gain attributable to the administrative and waste services subsector), followed by leisure and hospitality sector (+43,000, with all of the gain occurring in the accommodation and food services subsector) and the trade, transportation, and utilities sector (+37,000, with 79.2 percent of the losses occurring in the retail trade subsector). Payroll levels fell the most in the information and construction sectors (-9,000 and -6,000, respectively).

“Over the last year, the American economy gained 2.1 million more payroll positions that it lost,” noted Quinterno. “The current average monthly rate of job growth—some 173,000 positions per month—nevertheless is insufficient to close the nation’s sizable jobs gap.”

Slack labor market conditions were evident in the April household survey. Last month, 11.7 million Americans (7.5 percent of the labor force) were jobless and seeking work. Both the unemployment rate and total number of unemployed persons essentially were unchanged from the prior month. Also in April, the share of the population participating in the labor force remained at 63.3 percent, a rate lower than the one posted a year ago. On a positive note, more Americans were working in April compared to a year ago, and fewer persons were unemployed. At the same time, the share of the working age population with a job remained near the lowest figure recorded during the current business cycle.

Last month, the unemployment rate was higher among adult male workers than female ones (7.1 percent versus 6.7 percent). Unemployment rates were higher among Black (13.2 percent) and Hispanic workers (9 percent) than among White ones (6.7 percent). The unemployment rate among teenagers was 24.1 percent. Moreover, 6.2 percent of all veterans were unemployed; the rate among recent veterans (served after September 2001) was 7.5 percent. At the same time, 12.9 percent of Americans with disabilities were jobless and seeking work (not seasonally adjusted).

Jobs remained hard to find in April. Last month, the underemployment rate equaled 13.9 percent. Among unemployed workers, 37.4 percent had been jobless for at least six months, and the average spell of unemployment was 36.5 weeks. The leading cause of unemployment remained a job loss or the completion of a temporary job, which was the reason cited by 54.8 percent of unemployed persons. Another 26.9 percent of unemployed persons were re-entrants to the labor market, while 10.9 percent were new entrants. Voluntary job leavers accounted for the remaining 7.4 percent of the total.

“The April employment report paints a very mixed picture of the American job market,” observed Quinterno. “The monthly job gain and the positive revisions to data from prior months were positive, but unemployment and underemployment remained elevated, while various measures of labor utilization remained at depressed levels. In many ways, the April employment report is another entry in a long series of underwhelming reports.”