Ray of light? Private sector cut 'only' 491,000 jobs in April
Filed under: Economy
Just call it another sign, albeit a modest one, that the recession may be bottoming. The private sector cut only 491,000 jobs in April, according to data compiled in the ADP National Employment Report (pdf).
Economists surveyed by Bloomberg News had expected private employers to cut 645,000 jobs in April. Private employers cut a revised 708,000 jobs in March, and 706,000 in February. The job loss totals in April by business size (large -- medium -- small): 77,000 -- 231,000 -- 183,000.
By sector, the services sector -- formerly a U.S. strength during the recent economic expansion -- lost 229,000 jobs. Manufacturing lost 159,000 jobs, its 38th straight monthly decline. The construction sector lost 95,000, its 27th consecutive monthly decline, and brought total construction jobs lost since the January 2007 peak to 1.261 million. However, April's decline was the smallest construction job loss since November 2008.
Don't throw a recovery party just yet
Harvard University Economics Professor Kenneth Rogoff, former chief economist for the International Monetary Fund, said a recovery is approaching but there are no grounds for euphoria, given the likely strength of the recovery.
"We're going to get to the point where the recovery is just not soaring and they're going to do the same again," Rogoff told Bloomberg News Wednesday. "We're going to have a very slow recovery from here."
By that, Rogoff meant that the U.S. economy will likely need a second fiscal stimulus package to compensate for the large demand hole dug by the pronounced recession in the housing sector, stock market and financial services.
The Obama administration expects the $787 billion federal stimulus package passed earlier this year to save or create about 3.5 million jobs nationally.
Economic Analysis: A mildly pleasant report -- pleasant because monthly private job losses came in well below the consensus estimate, and if that trend continues, that would be a strong sign that the recession is bottoming. Still, investors should keep in mind that the more telling statistic, containing both private and public sector job data, is the U.S. Labor Department's monthly payroll statistic, and the April data will be released Friday, May 8 at 8:30 a.m. EDT. That report is expected to show a 630,000-job decline in April after a 663,000 loss in March, according to a Bloomberg News survey of economists.
Investors should keep tabs on the monthly jobs reports by both ADP and the Labor Department because job creation is positively correlated with corporate revenue and earning gains. And as they say on Wall Street, as corporate earnings go, so goes the U.S. stock market.
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Reader Comments (Page 1 of 2)
5-06-2009 @ 11:20AM
ettucat said...
By all means, let's make certain all the big banks, and big businesses survive. Makes it much easier for the government to run just a few, rather than try to keep track of a million. Oh, and don't worry about the job losses. Those are being taken up by the illegals, who will work for lower wages and will continue to grow the Obama voter base.
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5-06-2009 @ 11:38AM
john said...
Yes, and the illegals will be hired by conservatives looking to cut costs and maximize profits.
5-06-2009 @ 3:09PM
MICKEY said...
Job cuts my ass. They just found someone cheaper or outsourced to another country and used the economy as a "socially acceptable" excuse for screwing the U.S. citizens. I've had so many jobs outsourced to India and Pakistan, that I MAY AS WELL MOVE THERE AND THEN SPEND MY WAGES IN THEIR COUNTRY.
5-06-2009 @ 11:48AM
Chuck said...
Amazing that conservatives increase the welfare burden of our country with their non living wage jobs. Then they complain about the people on welfare as if its the fault of the working poor.
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5-06-2009 @ 6:01PM
vdog said...
Great post Chuck!!! The REPUGS are the PARTY OF WALMART!!!!!
5-06-2009 @ 12:38PM
jao said...
I wonder how many "Public Sector" jobs were lost in addition to these "Private Sector" jobs?
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5-06-2009 @ 6:11PM
TERRY said...
TIME TO TAX THE S--- OUT OF THEM THEY GOT AWAY WITH ALL THE MONEY UNXDER BUSH SO WE CAN GIVE THE LAYOFFS AN UNEMPLOYEMNT CHECK TIL THEY GET A JOB
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5-07-2009 @ 8:10AM
huntdoc said...
Actually, the multinational companies that Obama wants to go after for evading taxes is reversing a Clinton-era policy. Bush didn't reverse the policy, so he complied with it.
5-06-2009 @ 12:58PM
Linda said...
Every day more people are loosing their jobs and BO continues to live in denial about his plans. Every day more people loose their homes, but hey, BO and his family will never be homeless...they will get to live off the American People for life!! It's true, our country is headed for a 2 class society...Rich and poor. Just like Mexico and other 3rd World countries our government will be rich and the rest of us will be living in poverty. I hope all you libbers and Democraps are getting this??!!
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5-06-2009 @ 1:04PM
Jeff said...
Republicans--- Democrats----- Who the he** cares? I just want to go back to work so I can pay my bills!!
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5-06-2009 @ 1:39PM
cmorse1052 said...
Republicans this, Democrats that. You pundits who try to capitalize on peoples misfortunes are sickening. Truth of it is 75 senators voted to give banks trillions of dollars while a majority, Democrat and Republican alike voted to kill a bill that would have given average americans a chance in bankruptcy court against the high powered lawyers hired by the banks. 12 Democrat Senators voted to kill the bill which means 39 republicans voted to kill the bill. It also means that some republicans voted for the bill and some democrats voted for the bill. Banks lobbied hard against this bill and won. Now the lobby is on to continue to allow large corporations to move jobs overseas while gaining tax shelters for doing so. The Democrats and Republicans are different in name only, I like to call them the rino's and dino's, (republican in name only, and democrat in name only).
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5-06-2009 @ 1:52PM
bobby duncan said...
At 491,000 how many months till everyone is unemployed.
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5-06-2009 @ 2:00PM
donweav said...
Yep, let's tax to death the last 3 employed workers and give their money equally to all the others. That seems more just and fair...comrade Obama.
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5-06-2009 @ 2:12PM
dan said...
We are in a worldwide depression although no one seems to have the courage to call it what it is. A world economy that was built on a concentration of wealth at the top 5% of the world population and speculation and defecit spending by governments and consumers alike is not likely to recover anytime soon reverting back to the same policies that got capitalism to it's final stage of errational exuberance and corrupt avarice to the extreme.We are now entering a period of new economic ideas and inovations,we shall have to wait and see if any of them work.The same old methods will only lead to the same old results.
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5-06-2009 @ 2:13PM
George said...
I wonder how many of this month's half a million newly unemployed(to add to the several million already so) know this.
The amount of taxpayers' money paid to AIG:
$180,000,000,000,
$180,000,000,000,
$180,000,000,000,
Yes, $180 BILLION OF OUR MONEY, which would pay a lot of unemployment insurance)
I also add that this was reported, in detail, on 60 Minutes on Oct 26, 2008.
(AIG is reported to have spent over $400 million in bonuses, I kid you not)
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5-06-2009 @ 2:30PM
dan said...
cmorse1052. Some republicans voted for and some republicans voted against the bill?That is stretching the facts a liitle bit, don;t you think? in view of the fact that only one republican senator voted for the bill.It seems that those who will not hold republicans accountable for their actions will always distort the facts in order to make their point a little more convincing.
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5-06-2009 @ 2:41PM
George said...
I don't seem to be able to get posted on "Wallet Pop". I see only one commentator recently.......What's going on? Censorship?
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5-06-2009 @ 2:45PM
Rem said...
"Socialism is just fine until you run out of other peoples' money" quote by Margaret Thatcher, former Prime Minister of Great Britain.
The Socialists in this country have been taxing the corporations in this country to the point that they can't compete and then criticize them when they have to start manufacturing offshore.
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5-06-2009 @ 2:57PM
George said...
Maggie also had another good one. .........
"No such thing as government money", equally true.
So, don't forget who stole OUR MONEY to bailout the banks(from their gambling losses in derivitive securities).
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5-06-2009 @ 3:17PM
REALIST123 said...
IF AMERICANS WERE NOT SO LAZY COMPARED TO THE REST OF THE WORLD AND EXPENSIVE THERE WOULDN'T BE A DEMAND FOR HIRING ILLEGALS. EVERYONE IN THIS COUNTRY THINKS THEY ARE WORTH $100K A YEAR.
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