Job creation in April bounced back from a disappointing March, with nonfarm payrolls growing by 211,000 while the unemployment rate fell to 4.4 percent, its lowest since May 2007.
Economists surveyed by Reuters had been expecting payroll growth of 185,000 and the headline jobless rate to tick up one-tenth to 4.6 percent. The payroll increase nearly tripled the dismal March number.
Market experts believe the report likely cements an imminent interest rate hike.
“The market has sorely needed a shot of unambiguously positive ‘hard’ data,” Quincy Krosby, market strategist at Prudential Financial, said in a statement. “This morning’s employment report suggests the Fed will most certainly move in June.”
Wages grew seven cents an hour to an annualized pace of 2.5 percent.
The unemployment rate dropped even as the labor force participation rate edged lower to 62.9 percent. The employment-to-population ratio increased to 60.2 percent, its best showing of 2017 and the highest level since February 2009.
“This just adds to the perception that it’s going to be easier and easier to find a job if you want one these days,” said Brian Coulton, chief economist at Fitch Ratings. “It’s job security that causes people to ask for wage rises. If it’s easier for them to get a job outside their company, they’re more likely to push for higher wages.”
An alternative reading on the unemployment rate that includes those not actively looking for jobs as well as those working part-time for economic reasons dropped to 8.6 percent from 8.9 percent in March, the best reading since November 2007. Those counted as not in the labor force swelled to 94.4 million but that was countered by an increase of 156,000 counted as employed, according to the household survey.
SOURCE: Jeff Cox