New figures show that job growth continued at a mediocre pace last month, and some economists say Americans may want to brace themselves for a few more months of disappointment.
The Labor Department today reported that employers added 165,000 jobs in April, with the unemployment rate ticking down to 7.5 percent. The figure comes in just above consensus estimates, which were at around 153,000 per Bloomberg. This is a slight acceleration from March's 138,000 jobs, a figure that was revised upward from the dismal 88,000 previously reported, but it is barely fast enough to bring the unemployment rate down.
In addition, March and April's figures represent a slowdown from more robust job growth in previous months. February's figure was also revised upward, from 268,000 jobs to 332,000.
Industries posting the strongest job growth included business and professional services, with 73,000 jobs, and leisure and hospitality, with 43,000 new jobs. Retail also added 29,300 jobs, and education and health services added 28,000.
Meanwhile, government continued to drag on job growth, losing 11,000 workers. The information industry, which includes publishers and telecommunications workers, lost 9,000 jobs, and construction shed 6,000.
The slight slowdown in job growth may be evidence of yet another "spring slump." Since 2010, an annual pattern has emerged: strong job growth early in the year, giving way to weak figures in the spring and summer.
A number of factors have contributed to each annual swoon, like the European debt crisis and political uncertainty, and experts have posited still other causes, like a problem with seasonal adjustment factors. However, any slump this year will likely be traceable to one key cause.
"I think this year's slump – and we will get a slump – has a definite cause, which is the sequester," says Nariman Behravesh, chief economist at IHS Global Insight. He adds that the pain may only just be beginning: "The biggest hits from the sequester will occur during the second quarter."
That means that employment growth could be gloomy for several months – nothing catastrophic, Behravesh says, but there is the chance of an uptick in the jobless rate. Still, many economists expect job growth to pick up by the end of 2013, once the economy shrugs off sequestration cuts.
While underlying job growth, minus volatility, is currently around 150,000, it's likely to pick up to 200,000 by the end of the year, Behravesh says.
The other troubling question is what type of jobs those will be. The retail and hospitality industries posted strong growth in April, but many jobs added in those fields are low-wage and low-skill positions. This is evidence of a long-term trend in the job market, where high- and low-wage jobs are increasing, but the middle is falling out.
"We're going to continue to see a polarization of jobs. We're going to continue to see an increase in high-quality jobs in the professional, managerial, and technical ranks," says Arne Kalleberg, professor of sociology at the University of North Carolina—Chapel Hill. "But at the same time, I fear we're going to continue to see a growth in low-wage, low-quality jobs in various service sectors."
That means that, when jobs finally do start coming back at a faster pace, educated Americans with plenty of marketable skills will win out.
"In order to get these good jobs, people are going to have to get more education, get more skilled," Kalleberg says.