April's Jobs Report and the Youth Problem

The Labor Department released its monthly unemployment report for April.

ByABC News
May 4, 2012, 8:32 AM

May 4, 2012 — -- U.S. employers added 115,000 jobs in April, fewer than economists expected, and the unemployment rate fell slightly to 8.1 percent as more people exited the workforce, the Labor Department reported Friday.

Economists had expected about 165,000 jobs to be added, according to a consensus figure from Bloomberg. April's jobs gain was the smallest in six momths.

"The unemployment rate is not materially changing, which is disappointing since privately held companies have continued to grow their sales and are generally the engine of job growth," said Brian Hamilton, CEO of Sageworks and a leading expert on privately held companies. "This probably reflects continued anxiety about the economy and where it will be 12 months from now. We are 34 months into an expansion and an 8.1 percent unemployment rate is too high at this point."

Employers added 120,000 jobs in March in that month's disappointing jobs report, which showed the jobless rate at 8.2 percent. But the Labor Department revised the March figure upward today to 155,000.

Employment increased in professional and business services, retail trade, and health care, but declined in transportation and warehousing, the government said.

"Looking through the revisions and weather effects, this report indicates a labor market that continues to show a modest pace of improvement, about in line with expectations and an economy that is making some headway in recovery," said Peter Hooper, a Deutsche Bank economist.

On Thursday, the Labor Department reported people filing for unemployment benefits fell last week. After inching higher during the last few weeks, the jobless claims fell to 365,000 for the week ending April 28, down from 392,000 in the prior week.

Hiring among U.S. private employers dropped in April to the lowest level in seven months, payroll company ADP reported on Wednesday.

Among the major worker groups, teenagers have the highest unemployment rate, but the imminent summer hiring season may make a dent in that figure.

In April, teenagers had a 24.9 percent unemployment rate, compared with a 7.5 percent rate for adult men and 7.4 percent among adult women.

Companies like Jamba Juice, based in Emeryville, Calif., have already started ramping up seasonal hiring in anticipation of stronger business during the warmer months.

The food retailer is planning to add 2,500 seasonal hires this summer for most of their 750 locations nationwide. The company employed about 4,900 people, 190 of whom are part of its corporate offices or operation services as of January 3, according to the company's latest annual report.

Its peak selling season is during the spring and summer, and seasonal hiring at Jamba Juice and other companies across the country is likely to boost employment figures -- at least temporarily.

Kathy Wright, vice president of human resources at Jamba Juice, said the company's preliminary numbers showed it has hired 500 seasonal employees so far.

Youth are generally the company's customer base, so the company says it is serving both its customers and the communities they live in by hiring young people.

"They are usually very excited to work for us," she said. "We have a team environment, and they love the product. If you love the product, you love the brand already, so coming to work is not like coming to work. It's having fun. We look for people with passion to deliver a great experience to our customers."

Wright says seasonal hires are usually between the ages of 16 and 19 and in high school or college and looking for summer employment

"They're out of school and have free availability when we have an open door," she said.

The company has also partnered with the Labor Department's Job Corps, the no-cost education and vocational training program to help underserved youth ages 16 through 24.

"We're committed to helping out as long as we continue to open more stores," Wright said, adding that the company's growth trajectory may lead to the opening of 40 more stores this year. Stores can employ 8 to 20 people, she said.

The company partners with Job Corps to place six to eight participants in the public agency's culinary schools, like its location in San Francisco, to intern at Jamba Juice's corporate office in Northern California.