April Jobs Report Preview: Where Are We Headed?
After volatility in the first quarter, April’s job numbers should give us a better idea of where the recovery is heading. While March’s growth was below that of recent months, it was likely a bounce back from very high growth in February (and also reflected the weather). Job growth in March was still above the level needed to create jobs to absorb the slowly growing population.
Overall, yearly average job growth has been trending down since 2014, consistent with an economy that is at a later stage in its recovery. However it is too soon to tell whether the trend will continue this year because in past years, first quarter growth has not been correlated with growth in the last three quarters.
On the household side, numerous measures of worker well-being show us that there are still workers whom a strengthening economy could benefit. One measure is the prime-age employment-population ratio, which tracks the proportion of the country’s working-age population that is employed. Although it ticked down last month, the prime-age employment-population ratio is at a relatively high level for this recovery. However, it is still lower than its series high of 81.9% reached in 2000. Continued growth in this measure would reflect more workers being able to benefit from new opportunities in the labor market.
Two other measures of worker well-being – the percentage of the labor force that is long-term unemployed and the percentage that is working a part-time job for economic reasons – are likewise improving. But they are still above levels reached in 2000, even as the headline unemployment rate has reached its 2000 level, which suggests that there is still room for further recovery on the worker side.
This month we’ll be watching whether the workers who have still not found jobs, are long-term unemployed, or are still working part-time for economic reasons can look to continued job growth to bring measures of worker well-being back to full recovery.