The United States added slightly more jobs than predicted in April, despite an increasingly tight labor market, rising prices, and concerns about a slowing economy, according to the Bureau of Labor Statistics on Friday.
There was also some good news about inflation: Average hourly wages increased by 0.3 percent for the month, falling short of the 0.4 percent forecast. Earnings increased 5.5 percent year on year, almost the same as in March but nonetheless slower than the rate of inflation. A different measure of unemployment that includes frustrated employees and those working part-time for economic reasons, known as the “real” unemployment rate, increased to 7%. The employment market is still chugging along, driven by solid employer demand. After little over two years, the labor market has remained resilient and is on course to return to pre-pandemic levels this summer. The labor force participation rate, a crucial indicator of worker engagement, dipped 0.2 percentage point in March to 62.2 percent, the first monthly decline since March 2021, as the labor force shrank by 363,000 people. With a 5.6 million difference between job ads and available employees, the level is especially important. The study is unlikely to persuade the Federal Reserve off its current course of interest rate hikes. The central bank stated Wednesday that it will boost its key interest rates by half a percentage point in a continued effort to slow price hikes that have reached their highest rate in more than 40 years. Overall, with labor market fundamentals remaining this strong — including extremely high wage growth — it’s unlikely that the Fed would abandon its aggressive objectives due to the recent episode of stocks downturn. What we overall see from this is that the unemployment rate remained at 3.6 percent, despite expectations that it would fall to 3.5 percent. Manufacturing, transportation, and warehousing trailed leisure and hospitality in terms of job growth and wages increased by 0.3 percent and were up 5.5 percent from a year earlier, almost in line with March.