The Labor Department released figures Friday touting the biggest gains in job creation in more than two years and an unemployment rate at its lowest since the height of the recession, but the figures disguise less promising news that hundreds of thousands of people quit looking for a job altogether, analysts say.
The April jobs report
showed a gain of 288,000 jobs, with a larger than expected drop in the unemployment rate from 6.7 percent to 6.3 percent — the lowest rate since October 2008.
But a significant portion of that drop, is due to the labor force shrinking by 806,000 in April, to a 35-year low.
"I consider 288,000 jobs created to be significant progress," Labor Secretary Thomas Perez told CNBC.
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"We are moving in the right direction. You look across the broad range in growth of last month, you look at construction jobs, education and health, professional and business services, these are all middle class and upper middle class jobs."
Many economists described the figures as strong, but analysts say the picture is not as rosy as it may appear.
"Today's employment report is quite strong on its face but some beneath the headline data points mitigate our enthusiasm," Dan Greenhaus, chief strategist at BTIG, told CNBC
Newsmax columnist Peter Morici pointed ou
t that the economy is producing too many low-paying jobs, and the auto and housing markets have yet to make significant gains.
Republicans also weighed in on the issue, saying Democrats have refused to take up the necessary measures to stimulate real job growth.
"President Barack Obama ought to call on his Democratic-led Senate to take up the stacks of House-passed jobs measures so we can get this economy moving again," House Speaker John Boehner said in a statement
Meanwhile, another cloud in the employment report is that worker pay is stagnating.
According to Bloomberg
, average hourly earnings held at $24.31 in April, and were up 1.9 percent over the past 12 months, the smallest gain this year.
Stagnant wages across the middle of the economy will be a significant issue going into the midterm elections, Politico says, with Democrats pushing for an increase in the minimum wage while Republicans are arguing for a new set of economic policies to boost faster job creation and higher pay.
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