Washington is In April, the U.S. added more jobs than expected, which shows that the economy has strong foundations even though GDP fell in the first quarter.
The Labor Department said on Friday in its most important jobs report that there were 428,000 more jobs in the nonfarm sector last month. The number of jobs added in March was revised down a little, from 431,000 to 428,000.
Reuters asked economists who thought that the number of jobs would rise by 391,000. From 188,000 to 517,000, people thought there were a lot of people. The unemployment rate stayed the same at 3.6%.
A top economist at Wrightson ICAP (LON: NXGN) in Jersey City says it’s not clear whether the Fed would be worried about more jobs or happy.
Labor costs would be less likely to rise if more people were willing to work, but if more employers were willing to pay more because they were short on workers, that would have the opposite effect.
The Federal Reserve is trying to change monetary policy so that inflation doesn’t rise, but it doesn’t send the economy into a recession.
After 22 years, the U.S. central bank raised its policy interest rate by half a percentage point on Wednesday. The Fed said it would start cutting back on its bond holdings next month, which is the first time it has done this in two decades. It began raising rates in March. “The labor market is very tight, and inflation is way too high,” Jerome Powell, the head of the Fed, said to a news conference.
Last month’s job gains show that the economy is strong even though output fell in the first quarter because of a record trade deficit.
On the last day of March, there were a record 11.5 million job openings, which made the jobs-workers gap even bigger than it was in February. This made it 3.4% of the labour force instead of 3.1%.
The average hourly wage increased by 0.3 percent, following a 0.5 percent increase in March.This reduced the year-on-year wage increase to 5.5 percent, down from 5.6 percent in March.
Compensation for American workers rose at its fastest rate in more than three decades in the first quarter, which helped keep domestic demand strong.
People think the Fed could raise its main interest rate above 3%, even though Powell said Wednesday that a rise of 75 basis points was not on the table.
