David Kirkpatrick

May 14, 2010

Good news everyone, unemployment is rising

Filed under: Business — Tags: , , , , — David Kirkpatrick @ 5:40 pm

Here’s the story behind that counterintuitive header:

It sounds dreadful. After drifting down consistently since last fall, the unemployment rate has suddenly shot up again, from 9.7 percent in March to 9.9 percent in April. But don’t despair: A rising unemployment rate is actually one of the best signs yet that the economy is bouncing back.

The unemployment rate rose for the right reason. Instead of shedding jobs, employers added 290,000 jobs in April, the strongest showing since 2007. The reason the unemployment rate went up is that a lot more people are suddenly looking for work. The government said that the labor force swelled by 805,000 people in April. That’s more than three times the number of new jobs, so the proportion of people looking for a job but unable to find one went up. Still, that big increase in the labor force marks an important shift in sentiment among people on the fringes of the economy.

1 Comment »

  1. Oh, horsepucky! If you believe that having unemployment go up two tenths of a percent is good news, then I have a bridge to sell you in Brooklyn.
    The unemployment number goes up when more folks APPLY FOR UNEMPLOYMENT INSURANCE. That’s because they JUST GOT LAID OFF and are placing a claim for benefits. That’s how that number is generated! Not because you decide to send out resumes, for pity sake!

    Comment by The Wiseman — May 14, 2010 @ 6:32 pm


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