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4 possible explanations for the shocking decline in new jobs
April’s jobs report badly missed the forecast of 1 million payroll additions, coming in at just 266,000. It’s such a big miss experts are scrambling.
By Ayelet Sheffey and Juliana Kaplan
Economists thought that the economy would add a whole lot of jobs — about a million, to be exact — in April. Friday’s job reports turned that thinking upside down with a big surprise: The US economy added 266,000 jobs in April, falling significantly short of expectations.
In fact, unemployment even went up.
It’s a twist that left economists and economy journalists alike befuddled. It was especially shocking in light of March’s report showing a gain of about 900,000 jobs, and in a double whammy, the April report revised that figure down to 770,000. Also, the unemployment rate rose from 6% to 6.1%, while labor force participation actually climbed to 61.7% from 61.5%, signaling that more Americans are looking to return to work but also that more are getting classified as unemployed.
Insider previously reported on reasons that millions of Americans may be slow to return to work, like health concerns and the need to stay at home, but as results from Friday’s report found, but this dynamic rate hints it’s not as simple as a labor shortage. More workers seem to be…
