Friday, May 02, 2014

May Flowers!

President Barack Obama with House Speaker John Boehner (R-Ohio) at the Andrews Air Force golf course.

Ah choo, looks like Spring is an allergy prone season. But for the upcoming Summer months, it looks like it's a little more better for the unemployed.

It seems like even with an inept Congress, President Barack Obama is getting things done. The Department of Labor releases its monthly jobs report for April and it seems like they gotten over 288,000 jobs for the month.

It pulls the unemployment rate to 6.3%.

This is great news for the unemployed and underemployed. That means that everything is working.

The Republicans already put their gamble on blocking minimum wage. A partially bipartisan bill was killed by the Stallmigos.

Also with that being said, it's unfortunate that the very same Republicans blocked immigration reform, the president's job proposals, green energy and unemployment benefits.

CNBC reports that despite the big number, not all the news was good: The headline rate tumbled as 806,000 people left the civilian labor force. The labor force participation rate slumped to 62.8 percent, its worst of the year and near 35-year lows. Also, the average work week was unchanged at 34.5 hours, as were average hourly earnings at $24.31.
Vice President Joe Biden (right) with Boehner, Harry Reid, Mitch McConnell and Nancy Pelosi.
Consequently, markets moved higher following the report's release, but only modestly. Stock market futures indicated a slight gain at the open, though government bond yields popped.

The report comes amid economic growth of 0.1 percent in the first quarter that consensus expects to reverse higher for the rest of 2014. Friday's number added to those hopes.

Employment surged across sectors, with professional and business sectors adding 75,000 and retail gaining 35,000. Food and drinking establishments rose 33,000 while construction added 32,000 positions, according to the report from the Bureau of Labor Statistics.

Revisions reported Friday further doused the weather story, as job creation was actually quite strong in the early months of 2014. Revisions pushed February's number to 222,000 and March's initially reported 192,000 to 203,000.

At the same time, the Federal Reserve has been forced to adjust its focus on the headline unemployment rate as a guide for policy.

The U.S. central bank had kept a 6.5 percent target as the trigger for a rate increase, but declining labor force participation and weak inflation ratings have forced the Fed to change its approach from targeting specific numbers to a more nebulous focus on the quality of economic conditions.

Friday's nonfarm payrolls report was unlikely to move the needle on Fed policy, which is focused on reducing the monthly bond purchases and keeping its target funds rate near zero.

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