Posted in Finance

U.S. employment cools sharply in April Fed exit pressure eases

 2021年5月7日

U.S. employment cooled rapidly in April, with non-agricultural employment increasing by only 266,000, far below the market estimate of 1 million, and a sharp decline from the March increase of 770,000 (revised figure), showing that the U.S. boom recovery began in the second quarter with weakening signals. Payrolls rose sharply from March, but only slightly from April last year. Weak employment data, so that the market on the Federal Reserve Board (Fed) may be early “exit” worries decline, the U.S. stocks of science and technology stocks not down but up, that the Stark 100 index futures index 7 day rise should be expanded.

Employment report the main data are as follows.

  1. February and March this year, the total number of jobs revised downward 78,000.
  2. April private sector employment increased by 218,000, far below the market estimate of 933,000, but also significantly less than March’s 708,000; manufacturing industry counter-reduced by 18,000, far worse than the market estimate and the March increase of 54,000; leisure, hospitality employment increased, but employment in the transportation and warehousing industry is a sharp decline.
  3. Average hourly earnings increased significantly by 0.7% over March, much higher than the market estimate of 0% and better than the negative 0.1% in March; however, hourly earnings increased only slightly by 0.3% over the same period last year, slightly better than the market estimate of negative 0.4%, but much lower than the 4.2% increase in March, probably due to the unstable impact of the “comparative base period”. The average weekly working hours per person was 35 hours, slightly higher than the market estimate and 34.9 hours in March.
  4. The unemployment rate edged up from 6.0% to 6.1% last month, higher than the 5.8% estimate.

The labor force participation rate rose 0.2 percentage points to 61.7%, slightly higher than the 61.6% estimate. The low employment rate (U-6, meaning those who intend to work full-time but can only work part-time as sex workers and those who are not actively seeking work) fell from 10.7% to 10.4%, indicating that the number of full-time workers continues to increase.

Economic scholars pointed out that the employment cooling in April, mainly because the Biden administration “relief plan” to provide excellent unemployment benefits, so that employers are willing to provide wages not easy to attract labor, the economic recovery momentum is thus weakened, but the Fed does not have to rush to reduce the scale of easing policy.