Total nonfarm payroll employment increased by 428,000 in April, and the unemployment rate was unchanged at 3.6 percent, the U.S. Bureau of Labor Statistics reported today. Job growth was widespread, led by gains in leisure and hospitality, in manufacturing, and in transportation and warehousing.
Watch me put lipstick on this pig!
And what a pig it is....
On the household survey, unadjusted, employment fell 115,000 last month. Further, nearly a million (940,000) people left the labor force; despite the job market being "tight" and "we need people" more people, by a million, decided to bag it entirely and "disappear" out of "we know what they're doing" number.
That's defined, by the way, as we know you're there but you're neither employed or unemployed, the latter of which you only are if you would like a job.
But it was the internals that made me sit up today.
Typically there is either a moderating or accelerating force in these numbers that's hidden in the hours worked. That wasn't the case this time; it was basically flat, and that's a huge adjustment because every tick is worth a huge number of jobs. Put a couple of tenths on there and a -500,000 number doesn't look so bad, and a +500,000 number is smoking good.
Never mind the employment-population ratio, which is the one number that determines long-term stability in government financing. It was down a tick and while one month does not a trend make it has been rising strongly.
No, the real 900lb Gorilla in this report is one nobody but myself that I'm aware of talks about, and that's the net change in participation among the educational groups. This month there was material loss in those with Bachelor Degrees and better -- by four ticks. This was a net loss in that group of 275,000 employed people among that segment of the population, eclipsing the net loss at the top line.
This is a recessionary print folks -- an early-stage one, but one nonetheless and yet with inflation and labor costs where it is the Fed has no choice but to continue to tighten policy and the longer and slower they go the worse this will be.
They should have put 200 basis points on Wednesday, and 200 more in the next meeting.
But of course they didn't, they won't, and as a result don't expect good things -- you're not going to get them.