Life is Good: Jobs Grow and Unemployment Declines in April

Non-farm payrolls increased by 164000 in April, vs 192000 jobs expected

The report said the Federal Reserve predicted that unemployment rate would be 3.8 per cent by the year-end and since it is already 3.9 per cent, the eventual unemployment figure could be even less, leading to an even quicker rise in interest rates. "That hasn't been done in a long time. we're at full employment".

If this sounds familiar, well, that's because it is.

The U.S. Labor Department cited better-than-average unemployment claims in ME and Colorado as a mark of the strong numbers. And it's just in time for all those college students who are heading home and looking for that summer job.

The details, of course, have been different every month, but this big picture has not.

But the number of jobs added was lower than expectations set by economists, who were anticipating that the monthly report from the Bureau of Labor Statistics would show 192,000 jobs had been added.

Last month, the economy added 164,000 new jobs as the unemployment rate fell to 3.9 percent, cracking 4 percent for the first time since 2000.

Higher prices along with no wage growth is putting an increasing strain on wallets. Over the past three months, monthly job growth has averaged 208,000. But according to USA Today, another disadvantage of low unemployment means a smaller workforce. The unemployment rate for adult women fell to 3.5 percent, its lowest level in more than 17 years.

- "The April employment report delivered a downside surprise for payrolls and threw a wrench into the recent wage momentum story". The best you can say is there are signs that it might happen soon. The average hourly earnings for private-sector workers rose only 0.1% in April, and yet many companies such as 3M, Whirlpool and Chipotle have started to increase prices in reaction to higher oil prices and trade war fears. "We are comfortable with our calls of three rate hikes this year amid ongoing shrinking of the Fed's balance sheet". Since then, though, it's only 2 percent.

"There's what appears to be hesitancy on the part of employers to raise wages", Cathy Barrera, chief economist for ZipRecruiter, told MoneyWatch Thursday.

United States gross domestic product (GDP) increased at a 2.3-percent annual rate for the first quarter of 2018, beating market consensus of a 2-per cent gain, but lower than the 2.9-percent growth rate in the previous quarter, the Commerce Department said on Friday.

Even with the unemployment rate drifting further below Fed officials' estimates of levels sustainable in the long run, the report didn't indicate fresh upward pressure yet on wages and inflation.

Inflation has shown signs of accelerating slightly, eroding some of the potential wage growth.

For Alan Krueger, former chairman of the Council of Economic Advisers under President Barack Obama, the weaker participation rate "suggests we are going to hit some speed bumps when it comes to expansion".

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