The service-sector number reported Thursday by the Institute for Supply Management is significant as the U.S. economy is a largely service-oriented economy. At nearly 60, the index is back near 2008 levels last seen before the Great Recession of 2008.  Read MoreJobs report is just an 'aberration': Cramer  The service number certainly will impact the Federal Reserve's perspective on whether or not interest rates could rise in the near future. It helps mitigate concerns in other areas of the economy that clearly show weakness.  However, serious challenges exist for the economy. These challenges will likely keep interest rates at low levels for a significant period of time. The Fed's quantitative easing will go away but a dovish Fed is here to stay for the foreseeable future. Here's why.  Job growth continues to be spotty at best with the unemployment rate, which held at 6.1 percent, providing a misleading picture.  Read MoreChart: What's the real unemployment rate?  If you look deeper into the jobs report, you will find a huge underemployment component which suggests that overqualified workers are still filling positions that they normally would not seek to fill if job growth was more healthy. That rate is at 12 percent. That's a huge number. It's not surprising therefore that attendance levels at post high school institutions (colleges) has never been higher.  If job growth remains sluggish, the Fed will keep rates low for an extended period of time. This must be factored into investment strategy and is a primary reason why the yield on the 10-year Treasury continues to hover near 2.5 percent. A hint of future action can be seen in comments by Janet Yellen recently, when she said there is, "considerable uncertainty about the level of employment." In other words, the job market has not recovered.  Where else is the U.S. economy is weak? Despite eye-popping numbers about housing sales increasing year-over-year, the real-estate market is still struggling. While some areas of the United States (such as Northern California) show real-estate values have bounced back, remember that for most of the country the recovery has been more moderate. What is particularly troubling is that this recovery is not driven so much by demand but instead on cheap money; interest rates are at record lows for mortgage rates. But when interest rates rise, who will be able to actually qualify for mortgage? How will rising rates impact the legions of real-estate owners who are still struggling under their mortgage debt?  Read MoreFed's Kockerlakota: US rates are not low enough  Other headwinds exist. Around the world, there are economies struggling to recover from the financial crisis. Just this week, Mario Draghi of the European Central Bank announced plans for a program to help Europe battle what is perceived to be the growing risk of deflation. Deflation is never a good thing for an economy and the risk is very real for Europe especially considering its economic socialist leaning that many believe negatively impact economic growth. China continues to bump along the bottom as its economy changes from exports to a more balanced consumption/export driven economy. The resulting impact in Asia has caused other economies to slow. In Latin America, countries are struggling under massive debt despite the recent positive impact of the World Cup and the future positive impact of the Olympics.  Meanwhile, the United States must still deal with a crushing deficit as well as the huge increase in entitlement costs. Both of these issues have not been meaningfully addressed by either legislative body or the administration. The proverbial can continues to be kicked towards an economic precipice.  But back to the good news. The service sector showed expansion, jobs growth is showing some signs of life, and that means that economic growth is starting to bubble back up amid all the gloom. There may still be hope after all for the U.S. economy to get back to a more normalized condition. Of course, we need to see what happens when quantitative easing is eliminated and the patient, the United States economy, has to breathe and grow on its own. That will be the real test.
OK, so the jobs report wasn't great. But look past the headline and this recovery is on—even if it's not a straight line up, says Michael Yoshikami.