U.S. Outlook: A Goldilocks payroll report in April

Scott Anderson
Posted by Scott Anderson
Chief Economist

Net new job creation is cooling off. Nonfarm payroll growth at 164K in April came in a bit short of analysts’ expectations for the second month in a row.

Modern, busy office with several people at desks, as young woman rushes by in a blur.Should we be worried about this deceleration in job growth?

For more on this, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on May 4.

Key observations:
  • Economists, including at the Fed, have noted that monthly job growth above 200K jobs per month was unsustainable, given our sluggish labor force growth.
  • The unemployment rate of 3.9% in April is the lowest unemployment rate in this country since December 2000.
  • Why we aren’t seeing serious wage and inflation pressures from such a low unemployment rate is a puzzle that’s likely to consume the Fed staff in the weeks ahead.
  • The cool-down in average monthly job growth makes me more comfortable with my forecast for just three interest rate hikes this year.

 

Read my full report.

 

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