The nationwide unemployment rate ticked upward to 3.9% in April and the pace of hiring slowed to 175,000 jobs, significantly less than the average monthly gain of 242,000 jobs over the last 12 months, the U.S. Bureau of Labor Statistics reported on Friday.
Workers’ hourly wages increased 0.2% to an average $34.75 in April, after rising 0.3% in March. On an annual basis, wages have increased 3.9% in the 12-month period ending in April. That represents the first year-over-year reading below 4.0% since June 2021.
The stock market rose Friday morning after the April jobs report was released, with investors apparently hoping that the news of a slowing economy will boost chances of a long-awaited cut in interest rates by the Federal Reserve Board later this summer.
The Fed has kept benchmark interest rates at a record 23-year high since July 2023 as part of its efforts to cool the economy and slow inflation to the board’s 2% target. The Fed’s next meeting on interest rates is June 11-12, however, there is one more U.S. employment report due out before then (for the month of May) on June 7.
April’s 3.9% unemployment rate was a 0.1 percentage point increase from March’s rate of 3.8%. The unemployment rate has fluctuated between 3.7% to 3.9% since August of 2023.
The labor force participation rate, which measures the percentage of the working-age population that is employed or actively seeking work, held at 62.7% in April, as it was in March.
The employment population ratio, which measures the percentage of the U.S. population that is employed, was little changed at 60.2% in April, compared to 60.3% in March.
In April, the most significant job gains occurred in healthcare, in social assistance, and in transportation and warehousing.
Healthcare added 56,000 jobs in April, in line with the average monthly gain of 63,000 over the prior 12 months. In April, employment continued to increase in ambulatory healthcare services (+33,000), hospitals (+14,000), and nursing and residential care facilities (+9,000).
Employment in social assistance increased by 31,000 in April, led by a gain in individual and family services (+23,000). Social assistance added an average of 21,000 jobs per month
over the prior 12 months.
In April, transportation and warehousing added 22,000 jobs, with gains in couriers and messengers (+8,000) and warehousing and storage (+8,000). Over the prior 12 months, employment in transportation and warehousing had shown little net change.
Employment in retail trade continued to trend up in April (+20,000). Over the prior 12 months, the industry had added an average of 7,000 jobs per month. In April, employment increased in general merchandise retailers (+10,000), building material and garden equipment and supplies dealers (+7,000), and health and personal care retailers (+5,000). Electronics and appliance retailers lost 3,000 jobs.
Construction employment increased by 9,000 jobs in April, lower than the increase of 40,000 in March. Over the prior 12 months, construction added an average of 22,000 jobs per month.
Employment was little changed over the month in other major industries, including manufacturing; wholesale trade; information; financial activities; professional and business services; leisure and hospitality; and other services.
The change in total nonfarm payroll employment for February was revised downward by 34,000, from +270,000 to +236,000, and the change for March was revised upward by 12,000, from +303,000 to +315,000. With these revisions, employment in February and March combined is 22,000 lower than previously reported in the preliminary estimates.
