It’s the least bad report of the year, but a quarter million jobs lost cannot be seen as a good report by any stretch. On the positive side, despite widespread job losses, the rate of decline slowed. There was a slight uptick in wages and hours worked, but this just offset a similar downtick the previous month to record-low levels. The drop in the unemployment rate is a bit deceiving because it’s due to many people leaving the labor force altogether. I expect the unemployment rate to rise, especially if people come back and try to rejoin the labor force.
Given the recent minimum-wage hike, I’m interested to see what happens next month. Teens suffer the highest unemployment rate, and they are constantly entering and exiting the labor force. The latest jobs survey was conducted before the minimum-wage hike, so next month’s report will indicate how teens were affected initially.
Overall I think the report indicates that the recession’s end is in sight. However, employment will continue to decline for most of the rest of the year. I expect we will see sluggish job growth thereafter, in large part because of the anti-growth policies coming out of Washington.
– Rea Hederman is assistant director of the Heritage Foundation’s Center for Data Analysis, where he is also senior policy analyst.