Jobs Report Shows Rapid Slowdown in Employment Growth

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May 3, 2024

The U.S. labor market in April added fewer jobs and saw slower wage growth than anticipated, with the unemployment rate edging higher, according to the jobs report released by the Bureau of Labor Statistics on Friday.

The April data showed the economy added just 175,000 jobs and the unemployment rose to 3.9 percent, falling short of economists’ predictions of 240,000 new jobs and a 3.8 percent unemployment rate. 

Wage growth in April was also more modest than forecasted. Average hourly earnings rose by only 0.2 percent from the previous month and 3.9 percent from a year ago, compared with the expected increases of 0.3 percent and 4 percent, respectively.

"The spring flowers may have been blooming in April, but the labor market showed modest signs of wilting," Jason Pride, chief of investment strategy and research at Glenmede, told Fox News on Friday.

The underwhelming jobs report, however, signaled that the Federal Reserve might cut interest rates sooner rather than later this year, causing stock market prices to soar Friday morning.

"Following a steady stream of sticky inflation data in recent months, today’s much-weaker-than-expected jobs report had to bring smiles to the faces of the Fed board," Morgan Stanley’s managing director Chris Larkin said

"It may not put a June rate cut back on the table, but unless it turns out to be an anomaly, it will increase the odds that the Fed will be able to get in at least one cut this year," Larkin added.