Latest Jobs Report Shows – Again – that Economy Can Heal Itself

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The Department of Labor’s (DOL) latest job numbers are being treated as gloomy news because overall unemployment marginally increased to 6.1 percent in April, up from 6 percent in March, below predictions. But look past the topline number and the news actually quite good. People are getting back to work and getter better jobs thanks to the loosening of restrictions put in place in reaction to the COVID-19 pandemic. That’s a simpler, better solution to economy’s problems than spending trillions more taxpayer dollars.

The number of people unable to work because their employer was closed or had limited business due to COVID-19 restrictions was 9.4 million, down by 2 million in one month. Similarly, the number who reported being prevented from looking for work due to outbreak was 2.8 million, down 900,000 in a month. Those are both big shifts.

So why did the overall unemployment number tick slightly upwards? The Department ascribed that in large part to declines in “temporary help services and in couriers and messengers.” Employment in the former fell by 111,000 in April, while courier and messenger jobs fell by 77,000. The combined 188,000 loss accounts for most of the economy’s overall loss of 266,000 jobs in the past month. In other words, fewer people are working temporary jobs, including ones like food and package delivery. That’s not a bad thing. It indicates that people are transitioning away from the jobs they took to ride out the outbreak and are getting better ones.

Workers are replacing part-time jobs with full-time ones, which indicates that employers are cutting back less on hours. The DOL reported that only 5.2 million people worked part time for economic reasons in April, down by 583,000 from the previous month. The average work week for nonfarm workers increased by 0.1 hours, reaching 35 hours overall. More people are getting out of their homes and attempting to return to normal life, as shown by hospitality being one of the sectors with the most gains, with 331,000 added jobs, including 187,000 at restaurants and bars and another 73,000 in amusements, gambling, and other forms of recreation. Hospitality is the sector that suffered the most during the forced lockdown, so its continued recovery is significant and positive sign.

The jobs are paying better too. DOL reported that average hourly earnings for nonfarm jobs rose by 21 cents in April, more than reversing an average loss of 4 cents in the prior month.

Simply put, the best thing the government can do to help the economy is step out of the way and let it heal itself.