The momentum in the front line of the recession still favors the dark forces of contraction, today’s update on employment for April suggests. One can argue that there’s a bright side to the job destruction, but that’s still wishful thinking. Indeed, it’s hard to put a positive spin on a retreat of 539,000 for nonfarm payrolls last month.
Yes, that’s better than the 699,000 drop in March, but then that’s not saying much. The hope is that the slowing pace of job loss is a sign of better times. Perhaps, although we shouldn’t expect too much too soon. The vanishing act in jobs continues to be widespread and deep, affecting both the goods-producing sectors as well the services side of the economy.
Still, the worst of the labor market’s contraction may be behind us, which is a reasonable forecast, as the apparent topping out in new filings for jobless benefits suggests. Yesterday’s update on weekly claims for unemployment benefits implies no less. But a slowing rate of job loss isn’t the same thing as job growth. Even if the labor market contracts at a much slower rate of, say, 200,000 jobs a month for the rest of the year, that’s still another 1.6 million fewer workers earning a paycheck by New Year’s Eve.