Business

US jobs growth falters in April

Burgers with US flags Image copyright Getty Images

The US economy added 160,000 jobs in April - undershooting expectations and well below the 208,000 created in March, official figures show.

March's figure was revised down from 215,000 and February's was also revised from 242,000 down to 233,000.

The jobless rate remained at 5% and average hourly earnings rose 2.5%.

April's report is being closely watched, as it could influence an upcoming interest rate decision by the US Federal Reserve.

Fed policy makers hold a two-day meeting starting on 14 June and some thought they might decide to raise interest rates.

'Particularly ugly'

But some think the latest jobs report has diminished that prospect.

Aberdeen Asset Management, investment manager Luke Bartholomew, said: "Anyone wanting a June hike should probably look away now. The headline number is disappointing, while the household survey looks particularly ugly.

"If there's a bright spot then it's wages which were a bit better than expected. That's important. The lack of any meaningful increase in wages has caused much head scratching at the Fed. But there's probably not enough here to keep a June hike a clear and present danger."

Image copyright Reuters

'Close call'

However, Paul Ashworth, chief US economist at Capital Economics, thinks that a rate increase is still possible.

"Overall, there is nothing here to swing the Fed's June rate decision very far in either direction. We still think the Fed will hike next month, but it's shaping up to be a close call," he said.

Mr Ashworth said the increases in average weekly hours worked and average hourly earnings were "reassuring".

In December, the Fed raised rates for the first time in ten years. That rise was seen as the first of a number of moves upwards and Fed officials have forecast two more rate rises for this year.

But since then the economic news has been mixed.

In April, official figures showed that US growth slowed to an annual pace of 0.5% during the first quarter of the year.


Analysis, Andrew Walker, economics correspondent

This is a rather disappointing report.

Slower growth in jobs - compared with what was expected and compared with previous months.

There was also a marked increase in the number of people not in the labour force. That means people are not looking for work, which can sometimes mean they don't expect to find any.

The good news was the slightly faster rise in average earnings. This has been a weak feature of the recovery after the financial crisis, so the acceleration, modest though it is, can be seen as encouraging.

Still, this was just one month's worth of data. That can give some clues about the underlying state of the labour market, but it's no basis for drawing firm conclusions.


Today's report showed the strongest jobs growth was in business services and healthcare.

Professional and business services added 65,000 jobs in April and healthcare recorded a 44,000 increase.

The number of those employed in mining fell back as the energy sector continues to suffer weak profits thanks to the low oil price.

The share of working-age Americans who are employed or at least looking for a job, fell 0.2% to 62.8%.

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