US unemployment rate remains at 3.6%, near 50-year low

US unemployment rate remains at 3.6%, near 50-year low

US unemployment rate remains at 3.6%, near 50-year low

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US employers added 428,000 jobs in April, capping a year of solid growth, adding more fuel to an already robust recovery. The jobless rate held steady at a pandemic low of 3.6%, the Labor Department said Friday.

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

“It’s been an extraordinary job recovery, but this kind of growth can’t last forever, especially now that the unemployment rate is this low,” said Scott Anderson, chief economist at Bank of the West in San Francis. “It’s getting harder and harder to find people to come back into the workforce, even if you’re paying higher wages.”

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

The rapid rebound in the labor market has been a cornerstone of the pandemic recovery and a major political asset for the Biden administration, even as the workforce has remained depressed by a number of factors, including layoffs. retirement and care. Employers posted a record 11.5 million openings in March, nearly double the number of job seekers, according to a Labor Department report released earlier this week.

Job postings hit new highs as 4.5 million Americans left or changed jobs in March, reflecting the strength of the labor market

This continued strength has allowed the Federal Reserve to take aggressive action to rein in inflation. The central bank raised its benchmark rate this week by half a percentage point, the biggest increase since 2000, in hopes of cooling the economy without pushing it into recession.

“We must do everything we can to restore price stability as quickly and efficiently as possible,” Fed Chairman Jerome H. Powell said on Wednesday. “We think we have a good chance of doing that without a significant increase in unemployment or a really sharp downturn.”

Even so, there are signs of growing uncertainty. The U.S. economy unexpectedly contracted in early 2022, largely due to widening trade gaps and falling inventory purchases. Inflation remains at its highest level in 40 years. And stock prices – which hit record highs during the pandemic – plunged last week, amid renewed fears of a possible recession this year or next.

“We’re in a weird phase of the cycle right now, where it’s unclear exactly which direction things are going,” said Liz Ann Sonders, chief investment strategist at Charles Schwab. “Obviously it’s a choppy market environment, and we’re starting to see some easing in different ways.”

Major companies, including Wells Fargo, have started laying off workers in recent weeks, and others, including Amazon, have said they are overstaffed, further complicating job prospects. (Amazon founder Jeff Bezos owns The Washington Post.) Overall, U.S. employers announced more than 24,000 job cuts in April, a 14% increase from the previous month. according to figures released this week by executive placement firm Challenger, Gray & Christmas.

The labor market is still short of 1.2 million pre-pandemic jobs, although several sectors have made up for their recent losses. Transportation and warehousing, for example, and professional and business services each have about 700,000 more employees than in February 2020.

Amazon’s new labor problem: what to do with too many workers

Restaurants, bars and hotels are struggling to catch up after widespread layoffs at the start of the pandemic. The leisure and hospitality industry has been rapidly adding jobs, although it is still down 1.4 million positions, or 8.5% of its workforce, from employment levels. before the pandemic.

“The leisure and hospitality sector has led the recovery, but there has been some slowdown. Wages are not as high as in other sectors and people are reluctant to return to these jobs and stay there. “Said Nela Richardson, chief economist at the ADP Research Institute. “That’s where you see both the highest job openings and the highest turnover, in terms of quits.

Lou Salameh, who owns 10 sandwich shops in Jacksonville, Fla., says he can’t find enough workers to keep business running smoothly.

It began closing two hours earlier, at 6 p.m., and often has to close parts of its restaurants even earlier if it runs out of employees. It has raised wages to around $12.50 an hour and started offering weekly and monthly bonuses to its 150 employees, but is still about 50 workers short.

“It’s extremely hard to find help and even harder to keep help,” said Salameh, owner of Sheik Sandwiches and Subs. “The salary is at an all-time high. We offer benefits and bonuses, but it didn’t make a difference, to be honest. It just seems impossible.

Millions of people retired early during the pandemic. Many are now returning to work, according to new data.

But for many workers, the tight labor market continues to prove beneficial.

Leah Kush, who lives near Chicago, recently quit her 11-year job in the radio industry for a position at a digital marketing firm. Everything happened very quickly: Kush applied in early April, interviewed a week later and received a job offer less than 24 hours later.

“It was so easy I thought, ‘Wow, that was meant to be,'” the 41-year-old said. “I feel alive again.”

Kush earns 33% more than at her last job, where she hadn’t had a raise in eight years.

“There was no extra pay, but they kept piling stuff on my plate,” she said. “Finally, in January, I was like, ‘I have to come up with something new.’ And I’m so glad I did.

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