School of Economics Professor Danny Boston is a regular guest on CNN, analyzing the Department of Labor's montly Unemployment Report. The new numbers are out, and Boston says it's disappointing.
The report suggests that the economy is still struggling to gain a solid footing in the recovery. The good news is that the unemployment rate declined from 8.3 percent to 8.2 percent. The bad news is that there were only 120,000 jobs created last month, one half of what was created the month before and for the last several months. Most troubling is that the size of the labor force decreased by 164,000 persons, after increasing by almost 500,000 in previous months.
The decrease in the size of the labor force probably accounts for why the unemployment rate decreased from 8.3% to 8.2%. It will take another month or two to determine whether what occurred in March is a trend, which indicates that the economy is slowing, or whether it is an aberration.
Boston also mentioned that there is an indication that something may be wrong with the statistics. The labor force decreased by 164,000 people, a number that should be reflected by an increase in the number of discouraged workers. However, the number of discouraged workers also decreased by 141,000. Boston says there will probably be a large statistical correction to the report somewhere in the next month or two.
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