More than 200,000 discouraged people who had left the ranks of job-seekers returned last month, which is why the jobless figure didn't budge. The White House argued that this was a good sign, because it showed Americans were more confident that the economy was turning around.
But as more of these once-discouraged workers reenter the job search, it will raise the unemployment rate, as there simply aren't enough jobs being created to absorb them all. Economists say there are 5.4 job seekers per opening, far higher than in previous recessions. The ratio was 2.8 per job opening in September of 2003.
When discouraged Americans who are no longer seeking a job -- and thus are not counted in the monthly employment survey -- are added to the real unemployment rate, it zooms to 17 percent.
While the White House was still crowing that their job-creation policies were working, the Labor Department announced last week that the number of workers filing for unemployment benefits jumped by 18,000 -- to 460,000 for the week ending April 3.
MFR Inc. chief economist Joshua Shapiro told his clients that the higher jobless claims raised new questions about whether non-farm payrolls were really "poised to begin sustained gains."
The fact of the matter is that the anemic 128,000 jobs the private sector produced last month is only an infinitesimal fraction of the 15 million who are unemployed and looking for work.
The first quarter's much-ballyhooed 5.6 percent economic growth rate was an aberration reflecting accounting adjustments on slower rates of drawdown in inventories, says economist Peter Morici at the University of Maryland's School of Business.
"Sustainable growth -- demand by private consumers, businesses for expansion and government -- only grew about two percent," Morici says in his latest analysis. "The present mix of policies from Washington won't accomplish the four or five percent growth needed."
Obama's weak trade policies, energy development and job tax credits are not going to produce the high levels of growth needed to produce the nearly 400,000 jobs per month that are needed to slay the unemployment monster.
Neither will the higher federal income tax rates that await investors and small businesses and corporations at the end of this year when Obama will let the Bush tax cuts expire. Throw in a raft of higher health-care costs, taxes, penalties, fees and mandates on businesses and individuals, and you have a poisonous fiscal brew that is a jobs-killer.
Our once-mighty free market economy is in for a long, painful period of sub-par economic growth until the American people decide that they are fed up and have had enough.
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