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Friday, May 7, 2010

Payroll Employment Up 290,000; Unemployment Rate Jumps Up to 9.9%

In April, payroll employment rose by 290,000. This followed upward revisions for the months of February and March that totaled roughly 110,000 addition jobs. There have now been four consecutive months of expanding payrolls, though only two months of significant gains.



The improvement in payrolls was generally broad-based, and significant improvements in private sector employment growth drove the top line number. Private firms added 231,000 jobs over the month. Goods producing firms added 65,000, while services contributed the remainder.

Despite the payroll number gain, the unemployment rate, which is measured by a different survey, increased to 9.9 percent. Due to the smaller sample size of the unemployment survey, it tends to be more volatile and single month changes often are less meaningful than a multiple month trend. In addition, the labor force participation rate, which had fallen sharply for months hitting a 24 year low in December as more workers likely became discouraged, rose for the fourth straight month. Over the past four months over 1.6 million people have joined the workforce, with over 800,000 of them doing so in April. As payrolls continue to improve, it is likely that many discouraged workers will rejoin the labor force and this will continue to be a damper on lowering the unemployment rate.



10.05.07 (Source: Bureau of Labor Statistics)

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