Economists React to the April Jobs Report: ‘A Generally Disappointing Print’
The U.S. labor market slowed in April as the economy added a seasonally adjusted 160,000 jobs and the unemployment rate held steady at 5%. Other key numbers were mixed, with wages advancing a decent 2.5% from a year earlier but the size of the labor force falling. Federal Reserve officials are closely watching employment figures as they weigh their next step on interest rates. Here’s how economists and analysts reacted to Friday’s report from the Labor Department....MORE
“Based on the weaker-than-expected employment report and the emphasis in Federal Reserve communications on the benefits of moving cautiously, we have revised our outlook for the path of monetary policy. We now only expect one rate hike in 2016, in September, down from two hikes previously, as we believe it will take longer for policymakers to accumulate sufficient evidence that economic and labor market activity is rebounding after a soft start to the year. We also believe some FOMC members would prefer to see the outcome of the U.K. referendum before moving to hike rates again. If the economy improves along the lines of our baseline forecast, there is risk of a second rate hike this year in December.” —Michael Gapen, Barclays
“Employment was never going to continue rising at more than 200,000 a month indefinitely. Those monthly gains are simply unsustainable in an economy with a potential economic growth rate of less than 2%. Overall, there is nothing here to swing the Fed’s June rate decision very far in either direction. We still think the Fed will hike next month, but it’s shaping up to be a close call.” —Paul Ashworth, Capital Economics
“A generally disappointing print in employment is only partially offset by momentum in wages. For the Federal Reserve, stronger wage growth will be welcomed but not in an environment where domestic growth appears to be cooling. All eyes therefore remain on the handoff from a weak first quarter to the second quarter, with patience acting as the dominant theme.” —David Tulk, TD Securities
“Slow growth and low productivity weighed down April job creation. In addition, layoffs in 2016 are the highest they’ve been in seven years. Over this period the economy has also seen growth in temporary jobs and contracting relative to permanent positions. The upshot is that 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.” —Nela Richardson, Redfin
Other than the slow growth and the low productivity what did you think?