Total nonfarm payroll employment increased by 263,000 in April, and the unemployment rate declined to 3.6 percent, the U.S. Bureau of Labor Statistics reported today.
The change in total nonfarm payroll employment for February was revised up from +33,000 to +56,000, and the change for March was revised down from +196,000 to +189,000. With these revisions, employment gains in February and March combined were 16,000 more than previously reported. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors). After revisions, job gains have averaged 169,000 per month over the last 3 months.
In April, notable jobs gains occurred in professional and business services, construction, health care, and social assistance.Professional and business services added 76,000 jobs in April. In April, construction employment rose by 33,000, with gains in nonresidential specialty trade contractors (+22,000) and in heavy and civil engineering construction (+10,000). Employment in health care grew by 27,000 in April and 404,000 over the past 12 months. Social assistance added 26,000 jobs over the month, with all of the gain in individual and family services.
In April, average hourly earnings for all employees on private nonfarm payrolls rose by 6 cents to $27.77. Over the year, average hourly earnings have increased by 3.2 percent. Average hourly earnings of private-sector production and nonsupervisory employees increased by 7 cents to $23.31 in April.
The full BLS press release on the April 2019 employment situation can be accessed in the link below:
The next employment situation report for May 2019 will be released on Friday, June 7, 2019.
Real gross domestic product (GDP) increased at an annual rate of 3.2 percent in the first quarter of 2019, according to the "advance" estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2018, real GDP increased 2.2 percent. The increase in real GDP in the first quarter reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, exports, state and local government spending, and nonresidential fixed investment. Imports, which are a subtraction in the calculation of GDP, decreased. These contributions were partly offset by a decrease in residential investment.
The acceleration in real GDP growth in the first quarter reflected an upturn in state and local government spending, accelerations in private inventory investment and in exports, and a smaller decrease in residential investment. These movements were partly offset by decelerations in PCE and nonresidential fixed investment, and a downturn in federal government spending. Imports, which are a subtraction in the calculation of GDP, turned down.
During the fourth quarter of 2018 wholesale trade, mining, and information were the leading contributors to the increase in U.S. economic growth. For the wholesale trade industry group, real value added—a measure of an industry’s contribution to GDP—increased 9.1 percent in the fourth quarter, after increasing 7.4 percent in the third quarter. Mining increased 38.0 percent in the fourth quarter, after no increase in the third. This was the largest increase for the industry since the fourth quarter of 2008 and primarily reflected an increase in oil and gas extraction. Real GDP growth slowed to 2.2 percent in the fourth quarter from 3.4 percent in the third quarter. Finance and insurance was the leading contributor to the deceleration with real value added for the industry group decreasing 6.2 percent in the fourth quarter, after increasing 5.5 percent in the third quarter. Retail trade decreased 2.5 percent in the fourth quarter, after increasing 6.3 percent, and was the second leading contributor to the slowdown. The deceleration was primarily attributed to other retail, which includes health and personal care stores, gasoline stations, and nonstore retailers. Construction decreased 2.1 percent, after increasing 2.9 percent.
For all of 2018, annual Real GDP increased 2.9 percent (that is, from the 2017 annual level to the 2018 annual level). Information; professional, scientific, and technical services; and durable goods manufacturing were the leading contributors to the increase in real GDP. For information services, real value added increased 8.5 percent in 2018, after increasing 7.1 percent in 2017, primarily reflecting an increase in data processing, internet publishing, and other information services. Professional, scientific, and technical services increased 5.5 percent, after increasing 3.4 percent in 2017. This was the largest increase since 2008. Durable goods manufacturing increased 5.4 percent, after increasing 3.2 percent in 2017. The growth primarily reflected increases in motor vehicles, bodies and trailers, and parts as well as computer and electronic products.
The Consumer Price Index report, released by the U.S. Bureau of Labor Statistics, provides the latest evidence that inflation is soft; further evidence that the Federal Reserve Bank’s current policy stance of wait-and-see remains unaltered. The Consumer Price Index for all urban consumers (CPI-U) rose a seasonally adjusted 0.4 percent in March from the prior month. Over the last 12 months, the all items index increased by 1.9 percent before seasonal adjustment.
The energy index increased by 3.5 percent in March, accounting for about 60% of the seasonally adjusted all items monthly increase. The gasoline index increased sharply, the electricity index also increased, although the natural gas index declined. Food indexes—food at home and food away from home—increased by 0.3 and 0.4 percent respectively in March.
Core inflation—all items minus food and energy—rose 0.1 percent in March. The Fed’s preferred gauge has held steady at around its 2.0 percent price growth target, a “healthy for the economy” level. Along with the shelter index, the indexes for medical care, new vehicles, recreation, education, and tobacco all increased. In contrast, the indexes for apparel, used cars and trucks, and airline fares all declined in March.
The all items index increased 1.9 percent over the last 12 months ending in March; a larger increase than the 1.5 percent rise for the period ending in February. Core inflation rose 2.0 percent over the last 12 months while the food index rose by 2.0 percent and the energy index declined by 0.4 percent. The Fed has pointed to muted inflation pressures in recent weeks as one reason for the pause in their raising of short-term rates.
The full press release can be found via the link below.
Next release is Wednesday, April 10, 2019, for the March 2019 Consumer Price Index.
Nonfarm employment added 196,000 jobs in March, a result more in line with expectations than the scant, 33,000 jobs added in February. The unemployment rate remained steady at 3.8 percent and hourly wages increased modestly.
Averaging over the first three months of 2019 results in a solid 180,000 job growth, which amounts to nearly double its underlying demographic trend (Approximately 100,000 people enter the labor market each month). Job gains occurred across a wide range of sectors in March including health care, professional and technical services, food and drinking places, and construction. Health care added 49,000 jobs, mainly in ambulatory health care services and hospitals. Professional and technical services added 34,000, food service and drinking places added 27,000, and construction added 16,000. Manufacturing employment showed little change for the second month in a row (-6,000 in March, following +1,000 in February).
Despite stronger jobs growth, the unemployment rate remained unchanged in March. During the month, the labor force participation rate showed little change at 63.0 percent. The employment rate—or employment-to-population ratio (EPOP or the percentage of adults with jobs)—showed little change as well at 60.6.
The tighter labor market is showing some dividends in wage growth. The average hourly wage is up 3.2 percent over the last year; over the last three months (December, January, and February), the annualized rate was up 3.3 percent. With the core rate of inflation at 2.1 percent, increased hourly wages translate to modest real wage gains.
In sum, this is a mostly positive jobs report. The pace of job growth that began eight years ago is continuing, with the economy adding a total of 2.5 million jobs over the past twelve months. This growth rate is pulling more workers into the labor market, which is now tight enough to produce real wage gains.
The full BLS press release on the March 2019 employment situation can be accessed in the link below:
The next employment situation report for April 2019 will be released on Friday, May 3, 2019.