U.S. economy adds 263,000 jobs; unemployment rate drops to 3.6%
Friday, May 03, 2019
The April jobs report shows that nonfarm payroll employment rose 263,000 versus 196,000 new hires in March, according to the Bureau of Labor Statistics. April’s rate of unemployment declined to 3.6% versus March’s 3.8%.
April’s 3.6% rate of unemployment was the lowest since December 1969. In April, the number of long-term unemployed (those jobless for 27 weeks or more) was 1.2 million versus 1.3 million in March, the BLS reported. 21.1% of the unemployed in April were long-term unemployed, matching March’s rate. There is room for the labor market to improve.
"The unemployment rate fell for the ‘wrong’ reasons — more people leaving the labor force as opposed to getting a job," said Elise Gould, an economist at the Economic Policy Institute in Washington, D.C. "The overall labor force participation rate has dropped 0.2 percentage points for two months running, and now sits where it was exactly a year ago at 62.8%."
Hourly wages are not rising, though. "Wage growth held steady at 3.2%, where it has hovered for the past nine months," according to Gould. "That’s higher than much of the recovery, but still below the 3.5% level that would be consistent with the Fed’s targets."
The Federal Reserve’s Federal Open Market Committee met Wednesday and decided to continue its interest-rate policy, despite President Trump urging cuts. To boost "maximum employment and price stability ... the target range for the federal funds rate at 2-1/4 to 2-1/2 %" will remain unchanged, according to a Fed statement.
For major worker groups, unemployment rates dipped in April. For adult men, April’s jobless rate was 3.4% versus 3.6% in March. Adult women’s unemployment rate was 3.1% in April compared with March’s 3.3%.
Midsize employers (50-499 employees) hired 145,000 employees in April versus 63,000 in March and 95,000 in February,according to the ADP National Employment Report. Large firms (500 or more workers) hired 53,000 workers in April versus 60,000 in March and 77,000 in February.
Small businesses (payrolls of 1-49 employees) hired 77,000 new employees in April, compared with 6,000 in March and 12,000 in February. National franchise employment climbed to 9,500 new hires in April from 4,000 in March and 24,500 in February.
The ADP National Employment Report comes from ADP nonfarm private sector payroll data representing 411,000 U.S. clients and nearly 24 million employees, published in alliance with Moody's Analytics.
According to ADP/Moody’s report, the service-providing sector added 223,000 jobs in April compared with 135,000 in March and 139,000 in February. Professional and business services employment added 59,000 new hires in April versus 41,000 in March and 49,000 in February. Education and health firms hired 54,000 workers in March compared with 56,000 March and 37,000 in February.
Payrolls in the goods-producing sector rose 52,000 jobs in April, a sharp rebound from a loss of 6,000 jobs in March and 44,000 hires in February. Manufacturing firms added 5,000 jobs in April after losing 2,000 in March and hiring 17,000 new employees in February. Construction firms hired 49,000 workers in April after a decline of 6,000 hires in March and 25,000 new employees in February.
"April posted an uptick in growth after the first quarter appeared to signal a moderation following a strong 2018," said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. "The bulk of the overall growth is with service providers, adding the strongest gain in more than two years."
Mark Zandi is chief economist for Moody’s Analytics. "The job market is holding firm, as businesses work hard to fill open positions. April’s job gains overstate the economy’s strength, but they make the case that expansion continues on."
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