Daily Spotlight

April Payrolls Lower than Expected

The U.S. economy added only 220,000 jobs in April, below the recent trend (650k) and below expectations (900k). As well, the unemployment rate ticked higher to 6.1%. Revisions to previous months' jobs totals lowered the count by 78,000. Notable job gains in April were in leisure and hospitality, other services, and local government education. These were offset partially by employment declines in temporary help services and in couriers and messengers. The labor market continues to reflect the impact of the pandemic, as the shape and character of the workforce is changing as the economy recovers. The current number of jobs is approximately 8.5 million lower than the pre-COVID (February 2020) level. The labor force participation rate remains a low 61.7%, compared to the historical average of 65%. Last month, 18% of employed persons teleworked because of the pandemic. The Labor Department recently reported that another 498,000 people filed initial unemployment claims, down from more than 700,000 a month ago; the total of continuous claims was 3.7 million, down from 4.0 million a month ago. Though trending in the right direction, the data indicates that the employment environment is still under stress. We expect the unemployment rate will remain above 5.0% into 2022, and that the Fed therefore will keep interest rates low. ...  of the pandemic, as the shape and character of the workforce is changing as the economy recovers. The current number of jobs is approximately 8.5 million lower than the pre-COVID (February 2020) level. The labor force participation rate remains a low 61.7%, compared to the historical average of 65%. Last month, 18% of employed persons teleworked because of the pandemic. The Labor Department recently reported that another 498,000 people filed initial unemployment claims, down from more than 700,000 a month ago; the total of continuous claims was 3.7 million, down from 4.0 million a month ago. Though trending in the right direction, the data indicates that the employment environment is still under stress. We expect the unemployment rate will remain above 5.0% into 2022, and that the Fed therefore will keep interest rates low.   more

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