Politics

Evan Horowitz | Analysis

More jobs, fewer people working. How did that happen?

A help wanted sign on the door of a gas station in Encinitas, Calif.
REUTERS/File 2013
A help wanted sign on the door of a gas station in Encinitas, Calif.

When the jobs numbers come out each month, there are generally two figures people focus on: the number of new jobs and the unemployment rate. Did you know that these actually come from different sources? Unemployment numbers come from a survey of households, while job creation comes from a survey of employers (the “establishment” survey). This may sound like a technical difference but it means that sometimes the numbers point in very different directions.

This is one of those times. According to the establishment survey, the US economy created 288,000 new jobs in April. That’s a lot, the best number we’ve seen in two years.

On the other hand, the household survey actually showed a decline in employment. Fewer people were working and there was no change in the employment-population ratio. True, the unemployment rate fell, but that’s largely because of a big drop in the number of people looking for work.

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What do you do with mixed signals like these? Be cautious, wait for later revisions, and see if anyone else has a good handle on which numbers to trust. Here are some place to start.

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- Vox, here and here

- Slate

- Washington Center for Equitable Growth

- EPI

More by Evan Horowitz:

-- Yesterday’s recession will haunt us tomorrow

-- Who pays more in taxes?

-- Look beyond unemployment numbers in job market

Evan Horowitz digs through data to find information that illuminates the policy issues facing Massachusetts and the U.S. He can be reached at evan.horowitz@globe.com. Follow him on Twitter @GlobeHorowitz