Tomorrow’s Bureau of Labor Statistics report will show that unemployment remains at 8.8 percent according to most economists. This ends the steady decrease of jobless claims in the United States since November when it was as high 9.8 percent.
The growing number of people getting jobs in the private sector and the decrease of people participating in job search were helping in the decline in the unemployment rate.
However, job opportunities continue to increase in areas where most people are not trained for and will boost the unemployment number. Also, as discourage jobs seekers have begun looking for work in a better job market, they get added into the unemployment numbers.
The participation rate, which helps gauge people’s confidence in the job market, has been decreasing for some time now. It was 64.6 percent in March. In March last year, it was 65.3 percent.
“Basically participation in the labor force has been going down for some time. A lot of people are not seeking jobs because of structural changes,” said Nathaniel Karp, BBVA Compass’s Chief U.S. Economist.
The structural changes include baby boomers aging into retirement and people going back into school rather than searching for jobs. But others who are no longer considered participating are those too discouraged by the job market to continue looking for work, which is falling.
Between February and March, those discouraged fell to 921,000 from 1.0 million possibly because of growing confidence in the job market.
Jobs have been increasing since the recession especially in manufacturing. In March, that industry added 17,000 jobs concentrated in fabricated metal products and machinery.
Thomas Simons, an economist in VP Fixed Income, cautions that manufacturing only make up a portion of the economy.
“A rapid improvement in only 15 percent of the labor force is going to be a rather small effect in the total number,” said Thomas Simons.
Jobs in other sectors of the economy are growing that many in labor force are not trained for especially technical services. In March, technical services added 35,000 jobs in the economy.
The recent news of the initial unemployment claims rising to 474,000 in final week of April, if it has an affect in tomorrow numbers, would not raise it past 9 percent. However it will likely only contribute to keeping the unemployment number at 8.8 percent.