U.S. hiring slowed to 7-month low in April

May 06, 2016, 2:15 PM EDT
(Source: Mike Mozart/flickr)
(Source: Mike Mozart/flickr)

According to Labor Department statistics released on Friday, U.S. hiring slowed to a 7-month low in April: 160,000 new jobs.

Reuters reports:

The U.S. economy added the fewest number of jobs in seven months in April and Americans dropped out of the labor force in droves, signs of weakness that left economists anticipating only one interest rate hike from the Federal Reserve this year. Nonfarm payrolls increased by 160,000 jobs last month as construction employment barely rose and the retail sector shed jobs for the first time since December 2014, the Labor Department said on Friday. April's job gains were the smallest since September and below the first-quarter average job growth of 200,000. Adding to the report's soft tone, employers added 19,000 fewer jobs in February and March than previously reported. The slowdown in hiring came against the backdrop of weak economic growth, subdued productivity and corporate profits. It prompted several Wall Street banks, including Bank of America Merrill Lynch and Barclays, to lower their interest rate hike expectations for this year to one from two before the report. "We now only expect one rate hike in 2016, in September, 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," said Michael Gapen, chief economist at Barclays in New York.

CNN Money writes:

The economy is the No. 1 worry on voter's minds ahead of the presidential election. President Obama is trying to take a "victory lap" for the recovery from the Great Recession, but Republican presidential candidate Donald Trump slams the Obama economy as terrible. Wells Fargo chief economist Sam Bullard believes the economy is still jogging at a "moderate" pace. "I would not to say totally dismiss the report, but the labor market is stronger than that 160,000 figure would suggest," says Bullard. He points to the big jump in hiring in the business and "white collar" jobs in April. It wasn't just low-paying retail jobs on the rise. A lot of Americans have started looking for work again in recent months because they believe there are opportunities out there now. The notable exception is the energy sector. It shed another 7,000 jobs in April. Cheap oil continues to hammer the industry. Since September 2014, there have been 191,000 job losses in the energy and mining sector.

The Guardian notes:

Last week, the US Department of Commerce reported that in the first quarter of 2016 the US economy grew at the slowest pace in two years. On Wednesday, figures from the payroll company ADP showed private sector employers added just 156,000 jobs in April. According to another report by Challenger, Gray & Christmas – an outplacement consultant – released this week, US companies laid off 61,582 people between 1 and 30 April, a seven-year high. April’s layoffs included jobs lost in the oil industry and more than 10,000 jobs cut by Intel, the California-based technology company. Mining employment continued to decline in April, dropping by about 7,000 jobs. Since reaching a peak in September 2014, employment in mining has decreased by 191,000. With continuous job losses in the manufacturing sector and election uncertainty intensifying, “it would be surprising if the hiring trend didn’t slow further in coming months”, said Chris Williamson, chief economist at Markit.