The July employment report was released by BLS this morning and came as a pleasant surprise. The unemployment rate actually declined – by a tenth of a percentage point to 9.4% – for the first time since April 2008. Let's not break out the champagne, though. Payrolls were still nearly 250,000 lower in July than in June. It was not that long ago that a loss of 250,000 jobs in a single month would have been considered a calamity. Moreover, if the jobless recoveries of recent history are any guide, payrolls will recede further before ultimately turning the corner.

Still, even a jobless recovery is better than a job destroying recession. And the signs we're seeing look more and more like the beginnings of a shift from recession to recovery.


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