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US unemployment falls to 10-year low in April

LiveMint logoLiveMint 05-05-2017 AFP

Washington: The unemployment rate in the world’s largest economy fell to the lowest level in 10 years due to a strong rebound in job creation in April, the US labour department reported Friday.

After a slow March, when hiring likely was held down by a winter storm, the US economic engine added an estimated 2,11,000 net new positions while the jobless rate fell a tenth to 4.4%, the lowest since May 2007.

The result handily surpassed an analyst consensus, which had predicted 1,80,000 new jobs for the month, and rebound in the unemployment rate to 4.6%.

The news could offer the White House a measure of relief after a first quarter when economic data appeared to have softened. President Donald Trump has vowed to add 25 million new jobs over a decade but economists say this may be unrealistic.

The figures supported the view of a US economy in generally good health but with an increasingly tight labour market, which could begin to fuel inflation worries.

Wages continued to climb in April, with average hourly earnings rising nearly 0.3% for the month to $26.19, which is 2.5% higher than the same month last year.

The unemployment rate has now fallen 0.6 percentage points since the start of the year, with 854,000 fewer unemployed people, while average monthly job creation of 185,000 so far in 2017 is in line with last year’s trend.

The figures also followed signals from the Federal Reserve on Wednesday that the central bank was likely to stick to a planned course of two more interest rate hikes in 2017 despite softer economic data in the first quarter of the year, which it said was “transitory.”

While the share of long-term unemployed, or those without work for more than 26 weeks, was little changed at 1.6 million, other categories saw distinctly positive signs.

The number of those working part-time but who want full-time work fell by 281,000 to 5.3 million, down nearly 700,000 over the past 12 months.

So-called discouraged workers, or those who have stopped looking for work because they believe none is available, declined by 113,000 from a year earlier to 455,000.

The jobless rate for adult men fell three tenths to four percent but rose a tenth for women to 4.1%.

April saw job gains in leisure and hospitality and health care, which added a collective 92,000 net new positions. Bars and restaurants also continued to hire, adding 26,000 jobs last month, bringing the 12-month total for the industry to 260,000.

Insurance carriers hired 14,000 new workers. The mining sector gained 9,000 new jobs, having added 44,000 since October.

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