Contact us
CALL US NOW 1-888-GOLD-160

Employment Numbers an April Snow Job

  by    3   1

Donald Trump managed to shove his way into the spotlight again last week, claiming the US is heading for “a massive recession.” Unsurprisingly, the mainstream media scoffed at Trump’s assertion, pointing to the “great jobs report” that came out Friday.

fast food

The report did show the US economy added some 215,000 jobs, slightly more than expected. But once again, the headlines only tell a little piece of the story. And once again, most mainstream media and financial analysts are ignoring the bigger picture. In fact, all of the positive spin about a great employment outlook is nothing more than an April snow job. As Peter Schiff succinctly put it in his recent podcast, this was not a good jobs report:

We added the jobs we don’t want; we lost the jobs we do want. That is the real story. It’s the story nobody wants to tell. Everybody wants to talk about the number as if this is some kind of economic miracle.”

As was the case the month before, part-time jobs drove the increase. When you dig into the numbers, you find 127,000 of the new jobs went to people who already had at least one job. In other words, 60% of the new jobs were filled by people who were already employed. That means the vast majority were part-time. That doesn’t take into account people who had no job and took a part-time job as their first job. So well over 60% of the new jobs added in March were part-time jobs.

When you break it down, the full-time unemployment rate rose from 4.9 to 5.1% while the part-time rate dropped from 4.9 to 4.8%. Meanwhile, the 29,000 manufacturing jobs lost was the highest number since 2009.

Peter gave the perfect explanation for what’s going on with the job market in his podcast.

Those [jobs lost] are our best paying jobs. At the same time, the number of waiters and waitresses surged to an all-time record high. This is what’s going on. Let’s say you’re a waiter and your employer will not let you work full-time…because he can’t afford the benefits; he can’t afford the Obamacare…What do you do? You find another restaurant and you get another part-time job. That’s why we created 215,000 jobs.”

Still, a few people out there are questioning the traditional narrative and warn that the employment picture is blurrier than the headlines imply. As a CNBC article pointed out, most analysts and pundits focus on the official labor department unemployment rate, known as U3. It is the source of all the good news. But there is another metric known as U6. It encompasses not only the unemployed, but also “persons marginally attached to the labor force, plus total employed part-time for economic reasons, as a percent of the civilian labor force.”

That number doesn’t look nearly as good. While it has shown some improvement in the last couple of years, as the CNBC article put it, “it remains stubbornly at pre-recession levels.”

The U-6 number actually rose slightly to 9.8% in March. But even that doesn’t tell the full story, as CNBC pointed out:

Despite the improvement that government statistics show, some economists think the real employment situation is much more dire. They point to the labor participation rate, which measures the portion of eligible Americans who are counted among the ‘labor force’ in calculating the unemployment rate. The participation rate fell dramatically since the recession…”


In other words, part of the reason the unemployment rate is low is because so many people have simply dropped out of the workforce. They are no longer officially counted as “unemployed” even though they are not working.

There is another wrinkle in the jobs report few people reported. One of the indicators of future hiring is starting to lag according to John Canally, an economist and market strategist at LPL Financial:

Three months in a row temporary help has been very weak, just up 4,000 in March. That’s a leading indicator.”

A rise in temporary workers generally signals employers anticipate making long-term hires. Canally said there was a surprising decline of more than 55,000 temp workers in January and February combined.

So, when you put it all together, we once again have a lot of bad news on the employment front, packaged up in pretty wrapping paper. Say what you will about Trump, he may well be right about the recession.

This post is part of our ongoing series Data Dependent: Reading Between the Lines, where we examine the real economic data not reported in the financial media. Click here to read all our articles in this series.


Get Peter Schiff’s most important Gold headlines once per week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning more about physical gold and silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!

Related Posts

Trade Deficit Grows for Second Straight Month as Dollar Weakens

A shrinking trade deficit was the primary reason GDP jumped in the third quarter. But that trade deficit relief is already reversing. The October trade deficit swelled to $78.2 billion, a 5.4% increase. It was the second straight month of trade deficit growth.


Central Banks Start Q4 Buying More Gold

After adding a historically high amount of gold to reserves in the third quarter, central banks kicked off Q4 buying more gold. According to data compiled by the World Gold Council, central banks globally added another 31 tons of gold to official reserves in October.


Investors Fleeing Housing Market as Bubble Deflates

In another bad sign for a housing bubble that is quickly deflating, investor purchases of single-family homes tanked in the third quarter. Meanwhile, overall home sales continue to tumble and prices are falling.


Consumer Confidence Declines for Second Straight Month

The powers that be keep telling you that the economy is fine and inflation has likely peaked. But you’re not buying the story. Consumer confidence fell for the second straight month in November as worries about inflation and the trajectory of the economy persist.


Recession Warning: US Small Businesses Struggling to Pay Rent

In another sign of a struggling economy, small businesses are having an increasingly hard time paying rent. According to Alignable’s November Rent Poll, 41% of US small businesses reported they couldn’t pay their rent in full and on time in November. That was a 4 percentage-point increase from the previous month.


3 thoughts on “Employment Numbers an April Snow Job

  1. Joseph says:

    To confirm the lagging retail employment numbers, Staples announced it is coordinating with a workspace company, who will apparantly rent out desks to local businesspeople, presumably travelling business types, in the hopes that while they are using the desk, they will be tempted to buy office supplies in the brick and mortar store. And of course, that is on top of store closings. Bottom line: retail ain’t making the money it used to.

  2. jrj90620 says:

    I’m curious,how those worker dropouts survive.I keep reading that few Americans have much in savings,so how can they stop working and pay their bills/eat?Maybe the underground economy is much larger than we think.Maybe that economy’s size is what keeps the whole economy from collapsing.It’s my opinion,that for every Dollar govt takes in,it outputs less than .50,so an underground economy,keeping earnings out of govt,is a plus for our country.

  3. Bill Beach says:

    My three children are Technical college educated but only one has a job that pays well. The other two worked for Feds, Milltary and Mil. contractor. All middle age. Even with their tech. skills will they be able to find full time jobs related to their skills. Will my grand children even find other than minimum wage job? Thank you Dims, Repubs and Elites who want to make the US a third world country ruled not governed by the Constition.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Call Now