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U.S. Job Creation, Wage Inflation Miss Consensus in April

Published 05/04/2018, 08:31 AM
© Reuters.  U.S. creates 164,000 jobs in April vs. 189,000 forecast

Investing.com - Nonfarm payrolls (NFP) rose by 164,000 in April, according to official data released on Friday.

The data was lower than the consensus estimate for the creation of 189,000 jobs and below the 204,000 positions that the ADP report indicated on Wednesday.

The previous month’s reading of NFP was revised to 135,000 from the 103,000 registered initially.

On the plus side, the jobless rate fell from 4.1% to 3.9%, beating consensus expectations for it to slip to just 4.0%. April's reading is the lowest level since 2000.

Average hourly earnings advanced 0.1% month-on-month in April, below expectations for a 0.2% gain.

March’s increase was revised lower to 0.2% from the initial 0.3%.

On an annualized basis, wage inflation grew 2.6% in April, below expectations for a 2.7% rise.

The prior month’s advance was also lowered to 2.6% from 2.7%.

The increase in wages is being closely monitored by the Federal Reserve for evidence of diminishing slack in the labor market and upward pressure on inflation. Economists generally consider an increase of 3.0% or more to be consistent with rising inflation.

Average weekly hours clocked in at 34.5 last month. That was in line with the forecast for them to hold steady at March’s reading.

Additionally, the private sector created fewer new job contracts than expected in April with a total of 168,000.

Analysts had forecast the creation of 194,000 new jobs.

March’s number was revised to an increase of 135,000 private nonfarm payrolls, from the prior reading of 102,000 jobs in the private sector.

Government payrolls decreased by 4,000 last month, compared to the prior creation of 1,000 public positions.

The participation rate decreased to 62.8% in April, from the prior month’s reading of 62.9%.

The U-6 unemployment rate, that includes those workers who are working part-time for purely economic reasons, fell to 7.8% in April from the prior 8.0%.

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