“Wage pressures on inflation are proving persistent,’’ Brian Coulton, chief economist at Fitch Ratings, wrote in a research note. The Fed would like to see labor participation grow: More people in the job market would likely put downward pressure on pay growth and help contain inflation.Īverage hourly wages rose by 0.5% from March to April, nearly twice what economists had expected. Last month, the proportion of Americans who either have a job or are looking for one - the so-called labor force participation rate - was unchanged at 62.6%.
Most economists doubt that the Fed will succeed and expect a recession to begin sometime this year. They hope to achieve a so-called soft landing - cooling the economy and the labor market just enough to tame inflation yet not so much as to trigger a recession. He and other Fed officials have expressed concern that a robust job market exerts upward pressure on wages and prices. Layoffs are still relatively low, job openings comparatively high.įed Chair Jerome Powell himself sounded somewhat mystified this week by the job market’s durability. The job market has remained durable despite the Fed’s aggressive campaign of interest rate hikes over the past year to fight inflation. And hourly wages rose last month at the fastest pace since July, which may alarm the inflation fighters at the Federal Reserve.Īpril’s hiring gain compares with 165,000 in March and 248,000 in February and is still at a level considered vigorous by historical standards. Job gains for those months was downgraded by a combined 149,000. In its report Friday, the government noted that while hiring was solid in April, it was much weaker in February and March than it had previously estimated. The jobless rate fell in part, though, because 43,000 people left the labor force, the first drop since November, and were no longer counted as unemployed. The unemployment rate dipped to 3.4%, matching a 54-year low, the Labor Department said Friday.
WASHINGTON (AP) - America’s employers added a healthy 253,000 jobs in April, evidence of a labor market that still shows surprising resilience despite rising interest rates, chronically high inflation and a banking crisis that could weaken the economy.
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