The nation's labor market continues to plod along an uneven path, and only robust productivity can nurture a healthier labor market, says economist Ed Lazear, a former economic adviser to President George W. Bush and a senior fellow at the Hoover Institution at Stanford University.

The Labor Department said Friday that nonfarm payrolls increased 223,000 in April while the unemployment rate fell to 5.4 percent from 5.5 percent. Average hourly earnings rose three cents.

“The big problem, of course, is that productivity has not grown as rapidly as it should, and that's a symptom of the fact that we aren't investing in capital at the rate that we would expect to have been investing during a recovery,” he told Fox Business Network.

“One of the things we were worried about was that winter was a tough time, hours of work did not bounce back. That's symptomatic of a weak recovery,” said Lazear, chairman of President George W. Bush's Council of Economic Advisers.

The average workweek for all employees on private nonfarm payrolls remained at 34.5 hours in April.

“We're kind of on a so/so path. Things aren't terrible, but things aren't booming either,” he said.

“We have to make some pretty dramatic changes in the future to get things going again. This is unfortunate because we've had these low growth rates now for a very long time, and we need to make some significant changes to shake them off.”

He said the quest for higher minimum wages isn’t necessarily the answer.

“ I don't think that's way to do it. First of all, there aren't that many people who are affected by the minimum wage. By but the main point is the way you get wages growing in an economy is to have productivity growing,” he said.

“So, again, it comes back to how do we get productivity growing. What I would be looking at are a few basic policies. And they're the standard things. We need tax reform, we need a lower tax environment, less tax on capital, we need budgets, we need trade, and we need regulations under control.”

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