Employers created 160,000 jobs in April, a pretty low number that disappointed economists. It was the slowest pace of job growth since September.
Unemployment remained steady, the Labor Department reported. Wages were up, but so were layoffs. In all, it was a lackluster month. Here’s what it all means.
Employers Aren’t Adding Enough Jobs
Yes, they’re hiring, holding unemployment to 5 percent in April. But so far this year, employers have been reluctant to grow their payrolls. It’s not terrible, it’s just not good.
Layoffs Are Up
It’s been a bad spring for corporate earnings. Profit margins are down and executives are cutting costs. Employers announced 184,920 job cuts in the first three months of the year, according to outplacement firm Challenger, Gray & Christmas Inc. Coupled with recent stock market volatility, that might give some homebuyers pause this spring.
“Layoffs in 2016 are the highest they’ve been in seven years,” Redfin Chief Economist Nela Richardson said. “The U.S. is still adding jobs but people are now more at risk of losing them. This blunt fact is likely to hold off the Fed from increasing rates in June.”
Fewer People Can Be Called ‘Workers’
Labor-force participation, which measures the share of people working or looking for work, has been falling since the recession and is now 62.8 percent, very close to the 37-year low we hit last summer.
We can blame baby boomers for part of the decline–more Americans are retired these days and, by definition, aren’t workers. But there are plenty of adults who should be working or at least looking for a job and aren’t. Joshua Shapiro, chief U.S. economist at MFR Inc., called the trend “worrisome.”
“The participation rates of younger and of prime working age people declined, which was more of a barometer of limited job prospects than of anything demographic,” Shapiro wrote in a note to clients.
Wages Are Rising
Here’s the good news. Hourly wages climbed 0.3 percent from March and were up 2.5 percent from a year ago. People worked more hours, too, and in all had more to spend.
The Upshot
The economy isn’t terrible. We just want it to be better. And the silver lining for the housing market is that this slow growth has kept mortgage rates near all-time lows. That’s great for homebuyers and sellers.
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