The U.S. unemployment rate was little changed in April, at 8.1% versus 8.2% in March, as the economy gained only 115,000 jobs, the Labor Department reported Friday.
The anemic April report suggests that economic growth is slowing compared with earlier this year, when job growth was reported at twice that rate. Analysts had expected jobs growth of 160,000 last month, while the consensus for the unemployment rate was for no change.
Also barely moving the needle were the number of unemployed Americans, 12.5 million, and the number of long-term unemployed, 5.1 million, according to the Bureau of Labor Statistics’ April jobs release. A total of 342,000 people left the labor force.
The U.S. stock markets were lower in midmorning trading. The Dow Jones industrial average was down 100 points, or 0.75%, at 13,107. The S&P 500 was down 13.36 points, or 0.96%, at 1,378. The Nasdaq index was down 41.46 points, or 1.37%, at 2983.
“Disappointing, but not such a shock after ADP, whose 119,000 private job number was close to the official 130,000,” wrote Ian Shepherdson, chief U.S. economist with High Frequency Economics, Valhalla, N.Y., in a note, referring to the giant paycheck processor’s estimates, which are released before the federal jobs numbers.
“The core story here, we think, is that higher energy prices have had a temporary dampening effect on hiring, and this has been exacerbated a bit by the weather story, which surely supported sectors like construction at the turn of the year but with a payback now. The energy hit will fade now that gas prices are dropping back.”
Shepherdson said details show most of the slowing in the past two months was in private services, leisure and the professional/tech sector, with transportation weakening while retail picked up sharply.
“Disappointing but we think it is a correction after a run of very strong household employment numbers rather than a shift in the trend,” he wrote. “Overall, soft but most unlikely to prompt further Fed action, given the depth of the opposition within the FOMC. It would take at least another couple of months of reports like this, or worse, to trigger QE3.”
Read about the March jobs report at AdvisorOne.