'Like nothing that has ever been seen before': Here's what 4 economists said about Friday's April jobs report

The employment report for April was like nothing that has ever been seen before, Eric Winograd, senior economist at AllianceBernstein, wrote in a Friday note. If anything, the data probably understate the magnitude of the weakness; we know that several million workers filed new claims for unemployment insurance in late April after the data for today's report were collected. So, however bad it appears in the data, the actual situation is even worse.He continued: All that said, I don't think today's report is relevant to our understanding of the economy or to the formulation of a forward-looking view. We already knew that the labor market was in crisis; data that reflect that crisis don't change our understanding and thus don't add new information. The question that matters isn't whether the economy is at a standstill—it is. What matters now is when and how the economy recovers, and today's data are largely backward-looking and therefore don't alter our fundamental view of the outlook.We knew what was coming, Robert Frick, corporate economist with Navy Federal Credit Union, told Business Insider. Still, Friday's report drove home how terrible our situation is, how many millions of people are out of work, how low our economy is probably going to go in the second quarter. It was a real shock.He continued: The hopeful thing is that perhaps 18 million of those 33 million people who recently filed for unemployment are technically furloughed. So they may get their jobs back. If that's true, then this'll be the shortest depression in history.The number of furloughs now is a big difference from the Great Recession, Frick said, which could be a good thing. Right now you have deep pessimism about the current situation. Obviously, you know, this is, this is something that we'd never thought we'd experience, but people's longer term expectations are relatively high, he said.There's still a lot of hope in the economy and consumer confidence is extremely important — it keeps people spending, keeps them thinking about being in the workforce, he said. Read more: Russell Investments says these 4 stocks are perfect for investors on the hunt for ESG-friendly returnsIn one line: Catastrophe, enumerated, wrote Ian Shepherdson, chief economist at Pantheon Macroeconomics, in a Friday note.The plunge in payrolls ought to have lifted the unemployment rate to almost 20%, other things equal, but the BLS again reports that large numbers of people classified themselves as employed but absent from work, rather than unemployed on temporary layoff.This artificially suppressed the unemployment rate by about five percentage points. The problem of misclassification likely will persist for the foreseeable future so the headline unemployment rate will not be a useful guide to the real state of the labor market. The payroll and jobless claims numbers are more reliable.Read more: Renowned strategist Tom Lee recommends 12 beaten-down travel stocks to buy now for an average profit of 32% during the pandemic recoveryUsually this makes no visible difference to the data, but in April the job losses were disproportionately concentrated in relatively low-wage sectors like leisure and recreation. The disappearance of these people from the sample drove up the average level of earnings for the people who remained in employment, but it does not mean that underlying wage growth is rising.The opposite story will emerge in the data over the remainder of the year, because unemployment will remain elevated for the foreseeable future, putting downward pressure on wage growth.So we lost 'only' 20.5 million jobs. It says so much about the moment that we're in that that feels like a relief, Martha Gimbel, an economist at Schmidt Futures, told Business Insider. It's just unspeakably sad and horrible.The job losses across nearly all industries show that there's no part of the economy that is really escaping unscathed right now, Gimbel said. The report just reflects incalculable human suffering. She continued: One of the scariest numbers in the report was the issue of people who mistakenly identified themselves as employed, but absent from work, she said, adding that BLS notes that if those workers had been counted as unemployed, the rate would've been more than 19%. Read more: Chad Glauser has dominated his benchmark for 28 months straight using just 3 ETFs. Here's what they are, and how they've combined to beat the market.There are a lot of workers in that group who are telling themselves that they have a job to go back to and they likely won't, she said. If the situation doesn't get better, temporary layoff can become permanent.She also noted that the jump in wage growth was a purely compositional effect as the bulk of jobs lost were low-paying ones. No one thinks that the wages are growing faster. It just shows how brutal this has been for a low-paid workers, she said.

'Like nothing that has ever been seen before': Here's what 4 economists said about Friday's April jobs report

4. AllianceBernstein: "Like nothing that has ever been seen before"

3. Navy Federal Credit Union: "It was a real shock."

2. Pantheon Macroeconomics: "Catastrophe"

1. Schmidt Futures: "The report just reflects incalculable human suffering."