Unemployment Rate Drops to Lowest Level Since 2008

It's jobs report Friday, and we've got everything you need to know about this month's report.

May 2, 2014 at 1:00PM

The U.S. added 288,000 jobs in April, crushing expectations for growth of just 210,000.

Take The Long View

The markets were mixed on the news in early afternoon trading, with the S&P 500 (SNPINDEX:^GSPC) just over breakeven, the Dow Jones Industrial Average (DJINDICES:^DJI) down nearly 12 points, and the Nasdaq (NASDAQINDEX:^IXIC) up eight points. 

April by the numbers
At first glance, the numbers for April look fantastic. The unemployment rate dropped from 6.7% to 6.3%, and over a quarter of a million new jobs were added nationwide. The labor market looks healthier than it has been since the very onset of the Great Recession.

US Unemployment Rate Chart

US Unemployment Rate data by YCharts.

Digging deeper into the numbers, there is still tremendous reason for optimism.

The number of long-term unemployed -- those who have been unemployed for six months or more -- dropped by 287,000 people (although, 3.5 million Americans are still long-term unemployed).

The number of temporary workers increased by 24,000, an early indicator for potential full-time hires in the months ahead. 

These gains were by and large driven by the private sector. Government jobs increased just by just 15,000 in April, compared with 273,000 new jobs in retail, restaurants, business and professional services, and construction.

The Labor Department even revised the two preceding jobs reports higher, adding 11,000 jobs in March and 25,000 in February.

Baby boomers continue to have an impact
About 700,000 unemployed Americans stopped looking for work in April. This is a huge number, and it was a big reason why the unemployment rate dropped so significantly.

The unemployment rate calculation only includes individuals without a job who are actively looking for employment. Stay-at-home moms, retirees, and the like are not included as "unemployed." 

The combined impact of adding nearly 300,000 jobs with another 700,000 unemployed Americans dropping out of the labor force drove the unemployment rate down 0.4%.

Shuffleboard Retirees Public Domain

These shuffleboarding retirees are not considered unemployed.

This is not to say that there are no jobs available and that these individuals have succumb to some ill fate. The vast majority are baby boomers entering retirement, which is an established and continuing trend. However, it is always important in understanding any ratio to understand how the various inputs are interacting. 

Looking forward for the long term
This positive news comes right on the heels of this week's disappointing GDP report from the Bureau of Economic Analysis.

Many economists pointed to this winter's particularly cold weather as a drag on the economy and labor market, and they cited this report as confirmation that the warming weather is unleashing that pent-up economic activity.

Next week, the Commerce Department will release data on March's export activity. A strong report there would confirm this theory and offer very positive signs for the rest of 2014.

Sunny days, it seems, are finally here.

Top dividend stocks for the next decade
The smartest investors know that dividend stocks simply crush their non-dividend paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

Jay Jenkins has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers