Analysts have been expecting the U.S. labor market to start tightening, but the latest release from the Bureau of Labor Statistics might raise some concerns.
Today, the U.S. Bureau of Labor Statistics said that total non-farm payroll employment increased by 160,000 in April. (Source: “Employment Situation Summary,” U.S. Bureau of Labor Statistics, May 6, 2016.)
While the 160,000 additions look great on their own, the number was a huge miss compared to economists’ expectations of 203,000. Moreover, it also represented a sizable slowdown compared to the 208,000 jobs added in March.
The unemployment rate came in at five percent for the month of April, unchanged from March and in line with economists’ expectations.
Wage growth continued on. In April, workers’ average hourly earnings increased by $0.08 to $25.53. This followed a $0.06 increase in the month before. On a year-over-year basis, average hourly earnings have risen by 2.5%.
“It’s a soft report but it doesn’t portend a turn in the labor market,” said Michael Gapen, chief U.S. economist at Barclays. “I’d be more concerned if there were weakness across the board, but there wasn’t.” (Source: “U.S. Added 160,000 Jobs Last Month as Brisk Hiring Slowed,” The New York Times, May 6, 2016.)
Professional and business services continued their strong momentum by gaining 65,000 jobs in April. In the past 12 months, the industry added an average 51,000 jobs per month.
Mining employment continued its downward trend, declining by 7,000 jobs in April. Since its peak in September 2014, mining employment has dropped by 191,000.
The healthcare industry gained 44,000 jobs in April, while employment in financial activities rose by 20,000. Other major industries, including construction, manufacturing, wholesale trade, retail trade, transportation and warehousing, information, leisure and hospitality, and government showed little change in employment in April.