The FINANCIAL — U.S. employers resumed a solid pace of hiring last month and the jobless rate fell, priming the economy to snap back from a brutal winter, according to Nasdaq.
Nonfarm payrolls grew a seasonally adjusted 223,000 in April, rebounding from a weak March, the Labor Department said on May 8. The U.S. added just 85,000 jobs in March, down from a previously reported 126,000. It added 266,000 in February, slightly up from the previously reported 264,000.
The unemployment rate, calculated from a separate survey of households, fell to 5.4% in April from 5.5% in March. The decline reflected positive developments: The labor force grew as more Americans entered the job search and the number of Americans finding work increased. The jobless rate is moving closer to the Federal Reserve’s expectation of “full” employment, which it pegs between 5% and 5.2%.
Economists surveyed by The Wall Street Journal expected a gain of 228,000 jobs and a jobless rate of 5.4%.
The April report is an initial estimate and likely to be revised as the government collects fresher data. But for now the report suggests March’s weak hiring, along with the economy’s sharp slowdown in the first quarter, may have been a blip due to temporary factors.
Severely cold weather, a stronger dollar and a labor dispute that clogged the flow of goods at West Coast ports all likely held back growth and hiring in the first three months of the year. Gross domestic product grew at just a 0.2% annual rate from January through March, the government said earlier this month. That estimate is likely to be revised down, perhaps showing an economic contraction, after fresh data this week showing a surging trade deficit.
Many economists think the first-quarter woes were temporary and that the economy will rebound this spring, as it did last year from a first-quarter contraction. The Federal Reserve predicts a bounce back and is looking for hiring to return to a strong pace as it considers raising short-term interest rates as early as this summer.
Friday’s reported hinted at momentum. Workers’ hourly wages grew 3 cents to $24.87 and were up 2.2% from a year earlier. That growth is still modest, but it comes after amid other signs wages are slowly picking up from the weak 2% annual pace of recent years.
A broad measure of unemployment that includes Americans stuck in part-time jobs or too discouraged to look for work fell to 10.8% in April from 10.9% a month earlier.
But not all signs pointed to strength. The average workweek remained unchanged at 34.5 hours.
The share of Americans with jobs or looking for work remains weak historically. The labor-force participation rate rose to 62.8% from 62.7% last month, a sign of progress but still near the lowest level since the late 1970s.
Last month’s hiring covered several industries. Professional and business services added 62,000 jobs. Healthcare payrolls grew by 45,000. Construction also added 45,000. Manufacturing and retail jobs changed little. The mining sector, covering energy industries, fell by 15,000.