The 160,000 jobs added in April brings the three-month average employment gains down to 200,000.
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The low number of construction job gains in April may be a bad sign for the housing industry. Adding to the report’s soft tone, employers added 19,000 fewer jobs in February and March than previously reported.
In an interview before the release of the data Friday, Diane Swonk, an independent economist, said there were indications that wages were shoring up, even if the month-to-month pattern had been uneven.
The markets read the data as putting off a bit the next Fed rate increase, after it raised its benchmark short-term rate to 0.25-0.50 percent in December.
Some deceleration in the labor market is not the same thing as weakness, and although it’s too soon to know what the implications are for Fed policy, it’s not like investors were confident in another rate hike coming anytime soon anyway.
The dollar fell against a basket of currencies on the employment report, while prices for USA government debt rose.
“The unfinished business of the recovery is shared prosperity”, says U.S. Labor Secretary Tom Perez. “The latter is a useful indicator of GDP growth and suggests that the USA economy got off to a good start in the first month of the current quarter, thus reinforcing hopes of a bounce back from a subdued first quarter”.
Total nonfarm payroll employment rose by 160,000 in April, down from last month’s downwardly revised total of 208,000.
There were some silver linings in the report, with both average hourly earnings and the average work week rising.
The average work week increased to 34.5 hours from 34.4 hours in March.
Nariman Behravesh, economist at consultancy IHS, called the slower jobs growth “seasonal payback” for the strength earlier in the year. “Those monthly gains are simply unsustainable”, said Paul Ashworth, chief United States economist for consulting firm Capital Economics.
While employment dropped by 20,800 from March, the jobless rate moved only slightly, as the labour force – the number of people working or looking for work – shrank by 18,800. The labor force shrank. It shed another 7,000 jobs in April. The growth has been attributed to gains in white-collar jobs, as gains were reported in professional and business services, health care, and financial activities while job losses continued in mining. The participation rate fell to 62.8 percent from 63 percent, the first time in six months that the measure has fallen. Last month, however, the retail sector lost 3,100 jobs, after gaining 377,000 in the 12 months before.
Among other specific employment categories, computer and electronic products manufacturing increased by 500 jobs in April.
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Ashworth, however, insisted a rate hike in June remained on the cards, although it was no longer as straightforward a process as it seemed over the last few months.
