Unemployment Falls To Lowest Level In Almost 50 Years
RACHEL MARTIN, HOST:
With surprisingly good job numbers this morning - unemployment has fallen to the lowest level in almost 50 years. Employers added 263,000 new jobs last month. That's more than analysts had been expecting. And it's another sign that the U.S. economy keeps moving along after almost a decade of economic growth. NPR economics correspondent Scott Horsley is with us this morning. Hi, Scott.
SCOTT HORSLEY, BYLINE: Good to be with you, Rachel.
MARTIN: Pretty encouraging jobs numbers here - what do they tell us?
HORSLEY: Well, there's certainly no slowdown in the labor market. In fact, the pace of hiring is accelerating. In the first three months of 2019, we saw average monthly job gains of about 180,000. This is obviously well above that. We also saw a modest revision in February's jobs number, which had been sort of the low point in the year. So even though, as you say, the economic expansion is about to begin its second decade, it shows no signs of slowing down.
MARTIN: What about wages? That strong job market is helping to push wages up.
HORSLEY: That's right. Wages rose at an average of 3.2 percent over the last year. That's about the pace they've been climbing in recent months. And one thing that's encouraging is the strongest wage gains have come at the bottom of the income ladder. That's partly because of cities and states that have raised their minimum wage. But it's also because employers are having to compete for labor.
And we're kind of in a sweet spot right now because workers are getting more money in their pockets, but wages are not going up so fast that inflation becomes a big concern. Federal Reserve Chairman Jerome Powell addressed that this week and said he sees more room for the growth to continue.
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JEROME POWELL: For a long time now, there've been anecdotal reports of labor shortages and difficulty in finding skilled labor and that kind of thing. Nonetheless, you have very strong job creation. And you have wages moving up at a rate that is appropriate but not at all signaling any overheating at all.
HORSLEY: One thing that's helping is workers are becoming more productive. We got a report yesterday showing strong productivity gains in the first quarter. And that means employers can keep their costs in check, even as they're paying their workers a little bit more.
MARTIN: And what about that unemployment number, 3.6 percent? That is the lowest we have seen since 1969. What does that tell us?
HORSLEY: Yeah, that's a great bumper sticker. It's actually, though, not a great statistic in this case because the reason unemployment ticked down in April was a lot of people left the job market, according to the survey that's used to compile that number - nearly half a million people. Now, that's in contrast to the pattern we've been seeing in recent months, when a lot of people were coming off the sidelines and looking for work because the job market's been so strong.
And it's that trend we want to continue if we want to keep this expansion going. We want to certainly keep an eye that - on that labor force participation number. It can bounce around a little bit. And it may be noisy. We want to see participation increasing. In April, though, it went the other direction.
MARTIN: Any other weak spots in this report?
HORSLEY: Manufacturing employment was kind of weak. Factories added only 4,000 jobs last month. And revised figures for March show flat hiring in factories. For much of the last year, we saw manufacturing growing at about 22,000 jobs per month. So that does appear to be slowing down. That's consistent with some other indicators we've seen about manufacturing. The factory sector's still growing, just not as fast as it was last year.
We're also seeing continued job losses in the retail sector. We lost 12,000 retail jobs last month. But we gained 11,000 jobs in warehousing and transportation. So you see right there the shift to e-commerce. On the whole, though, a pretty strong report - good gains in business, health care and construction.
MARTIN: NPR's chief economic correspondent Scott Horsley. Thanks, Scott.
HORSLEY: You're welcome.
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