May Jobs Day

Every month, the Bureau of Labor Statistic releases their latest cut at the jobs data. And every month, we dutifully report the national unemployment rate, as if unemployment is a singular national phenomenon.

What you’re seeing there is average unemployment over the last year broken out by county. The differences between states and counties are tremendous. There are states in America that are enjoying genuinely good times. And then there are states with unemployment rates that, nationally, would be considered an emergency.

What caused the decline in the labor force participation rate in April? It’s not so much that lots more people stopped looking for work or left their jobs; it’s that fewer people started looking or started working, according to one Labor Department official.

“Our analysis of the household survey data suggests that the April labor force decline was due mostly to fewer people entering the labor force than usual, rather than to more people exiting the labor force,” wrote Erica Groshen, commissioner of the Bureau of Labor Statistics, in a statement on the numbers.

Here’s an interesting chart from the White House Council on Economic Advisors showing that the short-term unemployed and long-term unemployed have broadly similar educational attributes:

The unemployment rate for 16-to-19-year-olds is now at 19.1 percent, its lowest point since the fall of 2008.

That’s good news, and it shows a lot of healing from the height of the recession, when more than one-quarter of teens were unemployed. However, there is one catch, and as with so many things things job-report-related these days, it has to do with the labor force participation rate.

The monthly jobs number we know and love is a seasonally adjusted data series. But is the algorithm correct? The Brookings Institution has been publishing an “improved” seasonal adjustment number for a while now and BLS economists have given some indication that they agree this is better than the one they’re using. The improved method makes this month’s jobs report look a bit better:

Even more good news!

The labor force participation rate fell in April by 0.4 percentage points, from 63.2 percent to 62.8 percent. That level matches a 35-year low, and it may signal very bad things for the economy — it might mean that Americans have stopped looking for work.

So who is leaving? The jobs report provides a few clues. One of the most striking is that less-educated Americans’ participation rates fell, while people with degrees in fact participated more. Below is the percentage point change from March to April in the labor force participation rate for different education groups.

Here’s private sector employment (blue) and public sector employment (red) both indexed to their pre-recession peak: