The Employment Situation Report was released today. The headline jobs number was +54,000 and the headline unemployment rate was 9.1%. On an unadjusted basis, these numbers were +682k and 8.7% respectively.

Table A-15 provides the alternative measures of labor underutilization. U-6, the broadest measure (frequently called the “real” unemployment rate), dropped from 15.9% to 15.8% (unadjusted it dropped from 15.5% to 15.4%).

March and April were both revised lower (fewer jobs added).

For those interested in the Birth/Death model, that added 206k jobs to the unadjusted number. If you consider the whole thing bogus, the correct adjustment is not to subtract it from the headline (seasonally adjusted) number. Be careful, some people do this. Note that it isn’t black magic to take the term out. You find the adjustment factor (ratio of total employment numbers, not monthly change), subtract the part you consider bogus from the unadjusted number, and reapply the adjustment factor. Now compare the adjusted number to the previous month’s adjusted number (you should take out the bogus component there too). That’s your revised headline number. Unfortunately, since the change in the model, it’s been difficult to determine how bogus the model is. Previously, it was a funny joke (March numbers during a recession were essentially the same as the March numbers during a nice expansion).

This was a mediocre report. It was the weakest report since September. However, because of the ADP report, it should have largely been expected. The biggest surprise was the lack of “surprise” and “unexpected” from headlines, though (CNN wins with “NASTY JOBS SURPRISE”). If you apply others’ post-ADP revisions to their expectations to the Bloomberg consensus, you’d get about 100k (down from 170k). With this extremely shoddy methodology, you’d still consider this a downside surprise, but you might also shrug your shoulders and say, “Meh.”