U.S. unemployment hits 50-year low as employers increase hiring
WASHINGTON» Hiring accelerated and pay rose at a solid pace in April, setting the stage for healthy U.S. economic growth to endure despite fears of a slowdown earlier this year.
Employers added 263,000 jobs, with the unemployment rate dropping from 3.8 percent to 3.6 percent, the lowest since 1969. Though that drop partly reflected an increase in the number of Americans who stopped looking for work. Average hourly pay rose 3.2 percent from 12 months earlier, matching March’s year-over-year increase.
Friday’s jobs report from the government showed that economic growth remains brisk enough to encourage strong hiring nearly a decade into the economy’s recovery from the Great Recession. The economic expansion, which has fueled 103 consecutive months of hiring, is set to become the longest in history in July.
“All of the recession talk earlier in the spring was much ado about nothing,” said Gus Faucher, the chief economist at PNC.
Trump administration officials insisted the job market’s gains were a result of the president’s tax cuts and deregulatory policies.
“We have entered a very strong and durable prosperity cycle,” said Larry Kudlow, director of the White House’s National Economic Council.
President Donald Trump also has pressed the Federal Reserve to cut shortterm interest rates because inflation remains low. But most economists said the healthy jobs picture, against the backdrop of low inflation, would reinforce the Fed’s current wait-and-see approach. The Fed
raised interest rates four times last year but has signaled that it doesn’t foresee any rate increases this year.
Investors welcomed the April jobs data by sending stock prices broadly higher. The Dow Jones industrial average closed up 197 points, or 0.75 percent.
Jason Guggisberg, vice president of Adecco USA, a staffing firm that finds temporary and permanent hires for business clients, said companies are doing much more to attract workers. They are offering more perks — such as free lunches and weekly happy hours — and allowing more flexible work schedules.
Some are also raising pay, though Guggisberg said many of them have to be persuaded to do so. Adecco often has to show its clients data about how many jobs are available in a given area and how few workers are actually searching for jobs.
“We are constantly having conversations with clients about supply and demand” and reminding them that most applicants have multiple job opportunities, he said. “Two years ago, I don’t know that I ever had that conversation.”
The brightening economic picture represents a sharp improvement from the start of the year. The government was enduring a partial shutdown, the stock market had plunged, trade tension between the U.S. and China was flaring and the Fed had just raised short-term interest rates in December.
Yet the outlook soon brightened. Chairman Jerome Powell signaled that the Fed would put interest rate hikes on hold. Trade negotiations between the U.S. and China made some progress. The economic outlook in some other major economies improved. Share prices rebounded. And in the end, the government reported that the U.S. economy grew at a 3.2 percent annual rate in the January-March period — the strongest pace for a first quarter since 2015.
American households have become more confident since the winter and are ramping up spending. Consumer spending surged in March by the most in nearly a decade. A likely factor is that steady job growth and solid wage increases have enlarged Americans’ paychecks.
Businesses are also spending more freely. Orders to U.S. factories for long-lasting capital goods jumped in March by the most in eight months.
Years of steady hiring have sharply lowered unemployment for a range of population groups. The rate for women fell last month to 3.1 percent, the lowest point since 1953. The rate for Latinos dropped to 4.2 percent, a record low since 1973, when the government began tracking the data.
For Asians, joblessness has matched a record low of 2.2 percent. And unemployment for veterans of the Iraq and Afghan wars dropped to 1.7 percent, also a record low.
Most of last month’s job growth occurred in services, which includes higher-paying jobs in information technology and lowerpaying temporary work. Manufacturers added only 4,000 jobs. Construction firms gained 33,000, mostly on public infrastructure projects.
Professional and business services, which include IT networking jobs as well as accountants and engineers, led the gains with 76,000. Education and health care added 62,000 jobs. Retailers, however, continued to cut jobs, shedding 12,000 in April, the third consecutive month of cuts.