NEW YORK (TheStreet) -- This week U.S. growth and labor figures will be the focal point of financial markets. While many analysts tout the impressive headline readings, the data below the surface may be telling the real story.
U.S. nonfarm payrolls have exceeded the 200,000 monthly jobs marker since February and is one of the main contributors to the rapid decline of the unemployment rate. However, U.S. growth declined by 2.9% in the first quarter due to one-off factors such as severe weather.
Analysts hope growth this quarter will be aided by better-than-expected U.S. corporate earnings and the strong recovery in labor market conditions. However, the part-time employment rate for economic reasons remains historically high.
Part-time employment for economic reasons essentially means the person would really prefer full-time work but took a part-time job to pay the bills. The current percentage of part-time workers within the civilian labor force stands at 4.78%, according to Bureau of Labor Statistics data.
This percentage has receded from close to 6% in 2010 following the financial crisis, but remains at historically elevated levels compared to the unemployment rate, which could fall below 6% this month.
The situation mirrors the recession experienced in the late 1970s and early 1980s in the United States. During that period the unemployment rate spiked over 10% while the part-time employment rate rose to levels seen in 2010.
In the decade after, however, unemployment fell to 5%, while part-time employment declined to 3.75% during Ronald Reagan's presidency.
The comparison of the two eras shows that the present day labor market may still have some slack in it, and may not be as healthy as a sub-6% unemployment rate assumes.