STEVE INSKEEP, host:
OK, let's talk about the unemployment numbers, which we have received this morning from the Department of Labor. This is described as an almost universally positive report, exceeding economists' expectations for the number of jobs created, and yet the unemployment rate rose from 8.8 percent to 9 percent.
To try to explain what's going on here, NPR business reporter Tamara Keith is in our studios, once again.
Tamara, good morning.
TAMARA KEITH: Good morning.
INSKEEP: What happened?
KEITH: Well, that's a little bit of a mystery. A lot of economists had thought that the unemployment rate had come down more quickly than it should, and that that was a bit of a mystery. Well, now that it's rising, they can't exactly explain why. A very small part of it was that discouraged workers were returning to the workforce and starting to look again. They saw that things looked better. They said, let's go back.
But actually, the total labor force only grew by 15,000 last month, which is a pretty small number.
INSKEEP: Maybe we should just emphasize: It's a little weirdness, here. There's two different surveys, right?
KEITH: Yes.
INSKEEP: And they come up with somewhat different results. They're surveys. It's not counting - literally counting every single person. There's some margin for error.
KEITH: Right. And we've got a household survey and a payroll survey. They look at different things. And here's the thing: The payroll survey, that was impressive. That was very impressive, and showed an incredibly strong report.
INSKEEP: Two hundred, forty-four thousand jobs created.
KEITH: Actually, 268,000 in the private sector, and then offset by government. But 268,000 private-sector jobs created is the most single-month, private-sector job creation in more than five years.
INSKEEP: And wasn't there a thought that this would be a good deal worse than it turned out to be?
(Soundbite of laughter)
KEITH: Indeed. Economists had been predicting maybe 175,000. Some were starting to say maybe 150,000 jobs created. You know, there were a lot of reasons for them to think that things might not look very good. The first quarter economic growth came in at only 1.8 percent. First-time claims for unemployment benefits - which are sort of a weekly gauge - had been coming in, rising almost all month. And then we got this private-sector payroll report that also was weak. But then this government report came out, and we're like, wow.
I spoke to Jack Kleinhenz. He's an economist at Case Western Reserve University, and he was one of a great many who underestimated the strength of this report.
Professor JACK KLEINHENZ (Economist, Case Western Reserve): I'm encouraged. I'd rather see a larger number, obviously, and I don't mind being wrong or being off, especially in light of this. But we've had a very unique recession. We're going to have a unique recovery. We're going to have a unique expansion.
KEITH: Unique because it's been coming in fits and starts. But he says he's confident now, especially with this report, that the worst is behind us, now.
INSKEEP: OK. So the unemployment rate is 9 percent, but something in the neighborhood of a quarter million more Americans are working, or were working last month than the month before.
So what else do you find in this unemployment report that's of interest?
KEITH: Well, job growth was broad-based. Manufacturing continued to show strength. It was up 250,000 jobs over a - a little over a year. So that's massive expansion. Hiring was up in retail, leisure and recreation, health care, professional and business services.
The one weak area in the private sector was construction, which has been weak for a long time because of the housing market.
INSKEEP: Mm-hmm.
KEITH: That aside, though, lots of good news. The number of long-term unemployed dropped significantly. A few months of other reports were revised upwards by 46,000 more jobs created, and hourly earnings increased slightly, too.
INSKEEP: Only things really down: construction and, of course, government is down, as well.
KEITH: In fact, government was down 24,000.
INSKEEP: OK. Just in a couple of seconds, are economists pretty optimistic about the next few months?
KEITH: You know, there are clouds on the horizon, the big cloud being $4-a-gallon gas.
INSKEEP: OK. Tamara, thanks very much.
KEITH: Thank you.
INSKEEP: That's NPR's Tamara Keith, reporting this morning on the latest unemployment report. What we know is that unemployment, the rate rose to 9 percent, but the economy actually gained a net 244,000 jobs.
It's MORNING EDITION, from NPR News. Transcript provided by NPR, Copyright NPR.
