April jobs report remained steady at 3.6 percent

On May 6, 2022

U.S. employers added 428,000 jobs in April, capping a year of solid growth, adding more fuel to an already robust recovery. The unemployment rate remained steady at a pandemic low of 3.6 percent, the Labor Department said Friday.

The labor market has added more than 6.5 million jobs in the past year and is on pace to return to pre-pandemic levels this summer, although economists say there are signs that this record streak of employment gains is beginning to moderate. The number of people working or searching for work, for example, declined by 363,000 in April after six months of gains. And the pace of average wage growth slowed slightly to 0.3 percent, from 0.4 percent a month earlier.

“This has been an extraordinary jobs recovery, but this kind of growth can’t last forever, especially now that the unemployment level is as low as it is,” said Scott Anderson, the chief economist for Bank of the West in San Francisco. “It’s getting harder to find folks to come back into the labor market, even if you’re paying higher wages.”

In April, the biggest gains were concentrated in leisure and hospitality, manufacturing, and transportation and warehousing, as businesses tried to keep up with steady consumer demand for goods as well as services.

The job market’s rapid rebound has been a cornerstone of the pandemic recovery and a major political asset for the Biden administration, even though the workforce has remained depressed by a number of factors, including retirements and caretaking. Employers posted a record 11.5 million openings in March — nearly double the number of jobseekers, according to a Labor Department report released earlier this week.

Job openings hit new records, while 4.5 million Americans quit or changed jobs in March, reflecting labor market strength

That continued strength has empowered the Federal Reserve to take aggressive action to curb inflation. The central bank raised its benchmark rate this week by half a percentage point, the sharpest increase since 2000, in hopes of cooling the economy without sinking it into recession.

“We need to do everything we can to restore stable prices as quickly and effectively as we can,” Fed Chair Jerome H. Powell said Wednesday. “We think we have a good chance to do it without a significant increase in unemployment or a really sharp slowdown.”

Even so, there are signs of mounting uncertainty. The U.S. economy unexpectedly shrank in early 2022, largely because of widening trade gaps and falling inventory purchases. Inflation remains at 40-year highs. And stock market prices — which skyrocketed to records during the pandemic — have plunged in the past week, amid renewed fears of a possible recession this year or next.

“We’re in a weird stage in the cycle right now, where it isn’t completely clear what direction things are going in,” said Liz Ann Sonders, the chief investment strategist at Charles Schwab. “Obviously, it’s a…