Voya’s Timberlake: Jobs Report Masks Labor Market Positives
Kiplinger reported markets “brushed off a dismal April jobs report Friday” as the Dow Jones and S&P 500 closed the week at new highs despite the economy adding only 266,000 jobs last month, “well below the nearly 1 million expected by economists, while the unemployment rate ticked higher to 6.1% from 6.0%.” Voya Investment Management Head of Fixed Income Research Brian Timberlake said, “The payroll data does not suggest that the reopening is stalling. On a non-seasonally adjusted basis, 1.1 million jobs were added.” Timberlake said the upward tick in unemployment coincided with a small rise in the overall labor force participation rate, adding, “As a result, the employment-to-population ratio – which we view as more representative of the current labor market dynamics – increased for the month from 57.8% to 57.9%.” Timberlake ventured that the disappointing jobs report would likely “give Fed Chair Powell some relief on the urgency to talk about tapering.” In other words, said Kiplinger, “no changes to the central bank’s bond-buying program and no interest-rate hikes quite yet.”