graphic of business chasing stack of dollars

The U.S. economy sprouted 253,000 new nonfarm jobs last month, galloping past analysts’ consensus expectation of 180,000. 

Unemployment settled at 3.4 percent, tied for the lowest rate since 1969 and also better than the 3.6 percent that Wall Street had predicted. 

Jobs in the professions and business services grew by 43,000. Health care added 40,000, leisure and hospitality 31,000, and social services 25,000. Government took on 23,000 new workers, as did the financial sector, despite the banking industry’s lingering troubles.

Layoffs across the tech sector have freed workers who have been snapped up by companies in other sectors, The New York Times reported.

However, over the long term, job growth has slowed. February’s and March’s revised job gains together totaled 149,000 less than previously reported in initial estimates.

Gains through the last three months have averaged 222,000, compared to 524,000 for the same period last year, 290,000 over the preceding six months, and 400,000 a month averaged through the year 2022.

Job openings had numbered about two for every available worker a year ago. Now job listings in marketing are 43 percent fewer, while jobs listed in human resources have fallen by 45 percent. The two sectors are seen as barometers of corporate plans to grow, the WSJ noted.

Finance, manufacturing, and retail have throttled back their pace of hiring.

Still, the labor participation rate—the number of workers ages 25 through 54 working or actively looking for jobs—reached 83.3 percent in April, the highest since 2008.

Average hourly wages gained 0.5 percent in April, rising at an annual rate of 4.4 percent. Economists had foreseen an increase of 4.2 percent.

Workers’ raises have slowed from the 5.9-percent peak reached in March 2022 but remain well above the 3 percent that prevailed in 2019.

The labor market’s strength has been a key measure the U.S. Federal Reserve has used to determine whether to raise its key interest rate. April’s numbers show the jobs economy is stubbornly strong.

TREND FORECAST: It’s all in the numbers, and as we note in the ECONOMIC OVERVIEW section in this issue of The Trends Journal, they rig the numbers. 

Rather than blaming inflation on the Fed’s zero-interest rate policy and Washington pumping in some $6 trillion plus to fight the COVID War, the Fed-Head Jerome Powell claims that beating down inflation will require below-trend economic growth and a weaker jobs market.

However, financial markets have priced in only a fractionally higher chance that the Fed will raise rates again in June. Investors are still assuming the Fed is done boosting its rate this year.

And as for the numbers game, the gamblers on The Street are waiting for the government to release consumer price index data on Wednesday. They’re betting inflation increased 4 percent month-over-month in April, and 5 percent year-over-year. 

On Thursday, Washington will report on the producer price index.

Should the numbers come in below expectation, it will be the beginning of the end of Fed interest rate hikes which will boost both equities and precious metal prices.

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