BC Expert: Employment Report
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Associate Professor of Economics
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Professor Murphy served in the Clinton Administration as a senior economist at the Council of Economic Advisers; in that role, he served as editor of the Economic Briefing of the President of the United States. He has also previously addressed the World Congress on National Accounts and Economic Performance Measures for Nations. Professor Murphy is a frequent commentator on the U.S. economy and how it is affected by fiscal policy. His knowledge base includes international economics and finance, budget and deficits and public debt, inflation, interest rates, unemployment, trade deficits and surpluses, exchange rates and general issues related to the value of the dollar, trade policies, international financial markets, and the oil market.
MAY 2, 2014
Spring is fully underway, and so it seems is the hiring season, as an estimated 288,000 jobs were added to the economy. The impressive employment report by the US Labor Department this morning suggests the nation's economy continues to head in the right direction.
"Job gains were widespread across the economy,” says Boston College Associate Professor of Economics Robert Murphy. “April’s pace of job creation suggests an economy that is gaining steam and poised to grow strongly over the rest of this year.”
While today’s gains may boost optimism about the labor market, Murphy says the drop in unemployment rate to 6.3% may be a mixed message when you factor in the labor participation rate of 62.8%, which matches a three-decade low.
“The sharp drop in unemployment of nearly 750,000 people helped push the rate of unemployment down nearly half a percentage point,” says Murphy, a former senior economist in the Clinton Administration. “But this was also accompanied by a decline in the labor force of just over 800,000, indicating that doubt remains in the minds of unemployed workers as to whether continuing to search for jobs is worthwhile.
“The payroll employment number is really good---and consistent with the consumer spending report from yesterday along with the gain in factory output that we also got yesterday. This suggests an economy shifting into higher gear. But the drop in the unemployment rate, while on its face generally a good thing, is being driven by people exiting the labor force (and the household survey actually showed a drop of 73,000 in employment). Personally, I would put more emphasis on the payrolls number.”
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