Yesterday, I told you to ignore today's jobs report because Census figures would make it look unreasonably good.

That was sort of right. In reality, the report was certifiably bad. Hence the stock market losing its mind, with the Dow down 330 points as I write.

Total payrolls rose 431,000 in May, under the expectation of 540,000. About 411,000 additions came from Census hiring, so the normalized net gain was more like 20,000. That's pretty bad, especially when you consider the economy needs to add at least 100,000 jobs a month just to keep up with population growth.

But to that point, the unemployment rate fell from 9.9% to 9.7% after a net 322,000 workers actually dropped out of the labor market. Why? By and large, it's a factor of people giving up and stopping their job searches after becoming discouraged. A good way to visualize this is by looking at long-term unemployment, or those unemployed over 26 weeks (thanks to finance blog Calculated Risk for the graph):

That's a horror show, and it explains why so many are dropping out of the labor force. The reason long-term unemployment is particularly dangerous is because labor skills start atrophying. People either forget their previous skills, or those skills become outdated and unwanted.

Another chart that adds perspective is this recession's impact on jobs compared with other historical downturns:

If you want an admittedly stretched silver lining of this jobs report -- or at least something to cling to -- it's that these numbers are invariably revised in later months. It's entirely possible that May's 20,000-private-jobs gain could be revised closer to March and April's rate of around 200,000 jobs. Or it could go the other way, of course.

Another bright side: After the market lost its cool over this report, it's hard to say some stocks aren't looking cheap. BP's (NYSE: BP) dividend is approaching 10%; Altria's (NYSE: MO) is hugging 7%. Bad news and opportunity usually go hand in hand.

What do you think about the job situation? Share your thoughts in the comments section below.

Fool contributor Morgan Housel owns shares of Altria. The Fool has a disclosure policy.