According to this mornings’ Employment Situation Summary, released by the Bureau of Labor Statistics, the labor market added 253,000 jobs in April. This is a major increase from March’s revised addition of 165,000. The labor market remains hot amid heightened economic uncertainty. The ADP National Employment Report showed 296,000 added jobs in April. “The slowdown in pay growth gives the clearest signal of what’s going on in the labor market right now. Employers are hiring aggressively while holding paw gains in check as workers come in off the sidelines,” says Nela Richardson, Chief Economist at ADP.
According to the Job Openings and Labor Turnover Summary released this past Tuesday, job openings decreased to 9.6 million in March and layoffs and discharges increased by 248,000 to 1.8 million. These separations increased in construction, accommodation and food services, and health care and social assistance. Jobless claims were higher than expected in a recent release from the Department of Labor, but according to data from today’s jobs report, unemployment remained unchanged at 3.4% in April. Higher unemployment would be one sign of economic cooling.
The Federal Reserve approved the most recent rate hike on Wednesday bringing the range to pre-2008 levels. In the years prior to the Great Recession, the Fed raised rates 14 times increasing by 25 basis points each time. Between 2022 and 2023, the Fed has raised rates to the same level of 5-5.25%, but has done so in fewer meetings, meaning rates have most often been increasing by 50 or 75 basis points at a time. The past 14 months has shown some of the most aggressive action to curb inflation, but the labor market has resisted all efforts and continues a very slow decent.
Professional and business services led job gains again with 43,000 added jobs in April, with an average monthly gain of 25,000 jobs over the past 6 months. Health care added 40,000 jobs, with the most gains in ambulatory health care services, which increased 24,000. Leisure and hospitality added 31,000 jobs, most notably in food services and drinking places with a 25,000 increase. Social assistance added 25,000 jobs and financial activities added 23,000. Employment in construction, manufacturing, and wholesale trade changed little. The average hourly earnings for nonfarm payrolls increased by 16 cents and the average workweek remained unchanged for all employees.