Total nonfarm payroll employment rose by 165,000 in April, and the unemployment rate was little changed at 7.5 percent, the U.S. Bureau of Labor Statistics reported today. Employment increased in professional and business services, food services and drinking places, retail trade, and health care.
This is the opening paragraph of the government’s April employment report – called the Employment Situation news release for April - issued this morning. Initial media reaction was tepid (“hardly impressive” – CNN) but the markets are up – and they’re right. This is an encouraging report.
A gain of 165,000 jobs in April is respectable, and beats expectations. Revisions to the February and March figures add 114,000 jobs to the year’s total. (March’s revised 138,000 looks a lot better than the 88,000 initially reported.) The headline unemployment rate is down a tenth, which if nothing else will help consumer confidence. We are chipping away at the numbers of long-term unemployed and discouraged workers.
Additionally, most of the sectors gaining jobs – professional and business services, food services and drinking places, retail trade – are those that tend to do well in a growing economy. Expansion in these areas reflects, to a considerable extent, increases in discretionary spending by businesses and households.
The news could be better, of course. We would like to see more job creation; sustained gains of the order of February’s (revised) 332,000 would bring unemployment down rapidly. A large number of people who want full-time jobs are working part-time, pointing to severely restricted opportunities for the less skilled. But the good signs predominate.
We know that the economy has cooled somewhat after starting 2013 strong, and that employers facing business uncertainties, productivity concerns, and rising nonwage employment costs (notably those arising from the Affordable Care Act) have been careful about adding personnel. The April employment report suggests, however, that the slowdown is less serious than many had feared.