Jobs Report Better than Predicted
The U.S. lost 20,000 jobs in April, its fourth straight monthly decline. Once again there were big losses in construction, retail and manufacturing employment. But the overall losses were smaller than expected and the overall unemployment rate actually edged down a bit to 5 percent. It's the second major report this week to suggest that the downturn may not be as severe as some predictions a few months ago.
Job Losses Eased Up in April, Beating Forecasts
The U.S. economy suffered a net loss of 20,000 jobs in April, according to government data out today. Despite being the fourth month of job losses in a row, the decline was far smaller than the 80,000 shed in the first quarter.
Most economists had expected deeper job losses. The unemployment rate improved slightly, to 5 percent.
The better than expected numbers may signal the overall economy is deteriorating more slowly. But construction, hit by the housing crisis, continued to absorb big job losses, with 61,000 in April.
Since its peak in September 2006, the construction sector has shed 457,000 jobs. Manufacturing was hard-hit too, with a net decline of 46,000 jobs last month.
And there are more losses to come. GM announced in late April that it will cut production of pick-up trucks and SUV's, which is likely to mean layoffs for 3,550 workers.
Those negative numbers in construction and manufacturing were partly offset by a rise in health care employment of 37,000.
"I'm disturbed that we continue to lose jobs, but I do breathe a sigh of relief that it wasn't as bad as it could be," Peter Morici, a University of Maryland economist told NPR.
"We had very bad news though in manufacturing and construction, which means the wages of Americans will continue to head south relative to inflation."
Many businesses are shedding workers as the economy appears to be teetering on the edge of recession. Earlier this week, the government reported that the economy grew at an anemic annual rate of .6 of a percent in the first three months of the year.
"We have trouble in the banks. We have gas at $3.60. We have a huge supply of unsold homes. Consumers are terribly in debt and have to dig themselves out," Morici said.
That's likely to keep the economy sputtering for at least the next year, according to Morici.
The Federal Reserve lowered short term interest rates again on Wednesday in an effort to boost economic activity. The U.S. stock market opened sharply higher on the better than expected employment news.
From NPR reports and The Associated Press.
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