US Economy Adds 177,000 New Jobs in April, Tops Market Estimates

Payroll growth was led by health care, transportation and warehousing, and financial activities.

A hiring sign is displayed at a grocery store in Deerfield, Ill., on July 25, 2024. Nam Y. Huh, File/AP Photo

The U.S. labor market remains solid amid a backdrop of uncertainty as the economy created a higher-than-expected number of new jobs.

According to the Bureau of Labor Statistics, the U.S. economy added 177,000 new jobs in April. This is down from the 185,000 positions created in March, which was adjusted lower from 228,000.

Last month, the unemployment rate was unchanged at 4.2 percent.

Average hourly earnings held steady at 3.8 percent year-over-year.

The labor force participation rate edged up to 62.6 percent, and average weekly hours were flat at 34.3.

The consensus forecast indicated 130,000 new jobs and the unemployment rate holding steady at 4.2 percent.

Employment gains were concentrated in health care (51,000), transportation and warehousing (29,000), and financial activities (14,000).

Federal government employment tumbled by 9,000 and has declined by 26,000 so far this year.

“Employees on paid leave or receiving ongoing severance pay are counted as employed in the establishment survey,” the Bureau of Labor Statistics noted.

Manufacturing payrolls fell by 1,000.

Employed full-time workers increased by 305,000, while part-time employees increased by 56,000.

The number of people working two or more jobs decreased by 76,000 to 8.86 million.

The years-long gap in payroll growth among U.S.- and foreign-born workers narrowed last month.

Employed foreign workers declined by 410,000 from March to April. However, employed American-born individuals increased by more than 1 million.

The number of long-term unemployed—individuals out of work for 27 weeks or more—jumped by 179,000 to 1.7 million. The long-term unemployed account for nearly one-quarter (23.5 percent) of all jobless people.

Revisions continued as employment in February and March were adjusted lower by 58,000 from initial reporting.

Market Reaction

Investors cheered the solid April jobs report, with the leading benchmark averages up by nearly 1 percent before the opening bell.

U.S. Treasury yields climbed across the board. The benchmark 10-year yield topped 4.27 percent.

The U.S. dollar index, a metric of the greenback against a weighted basket of currencies including the Japanese yen and British pound, pared most of its losses following the jobs data and is poised for a weekly gain of 0.5 percent.

Chris Zaccarelli, CIO for Northlight Asset Management, said investors were pleased with the better-than-expected reading.

“Markets breathed a sigh of relief this morning as the jobs data came in better than expected,” Zaccarelli said. “While recession fears are still simmering on the back burner, the buy-the-dip dynamic can continue—at least until the tariff pause runs out.”

The latest employment data should contribute to a “very interesting” Federal Reserve meeting next week, according to Jay Woods, chief global strategist at Freedom Capital Markets.

“No one expects Jerome Powell to cut rates, but that press conference will be very interesting. What will the narrative be?” Woods said in a note to The Epoch Times. “He can take a more dovish tone seeing that unemployment remains at historically low rates 4.2 percent and that inflationary numbers remain stable, albeit sticky.”

According to the CME FedWatch Tool, investors overwhelmingly expected the U.S. central bank to leave interest rates unchanged in the 4.25 percent to 4.5 percent range. The odds are favoring a June rate cut.

In a Truth Social post, President Donald Trump again urged the Fed to lower interest rates, citing lower inflation pressures and strong employment.

“Just like I said, and we’re only in a transition stage, just getting started!” the president said. “Consumers have been waiting for years to see pricing come down. No inflation, the Fed should lower its rate!”

Holding Steady

Before the April jobs report, economic observers digested a series of figures to determine the performance of the U.S. labor market.

The number of job openings declined by 288,000 to 7.192 million in March, the lowest reading in six months. According to the Job Openings and Turnover Labor Survey (JOLTS) report, the decline in job vacancies was broad-based, led by transportation, warehousing, and utilities (59,000), accommodation and food services (42,000), construction (38,000), and federal government (36,000).

The Bureau of Labor Statistics also reported two mixed findings. First, employers ostensibly took a wait-and-see approach as new hires were little changed at 5.1 million. Second, job quits climbed by 82,000 to 3.332 million, signaling that workers remain confident they will find another position.

Private companies hired fewer workers last month. Payroll processor ADP confirmed in the April National Employment Report that companies added 62,000 employees, down from 147,000 in March.

Uncertainty continues to be a driving factor for businesses, according to Nela Richardson, chief economist at ADP.

“Unease is the word of the day. Employers are trying to reconcile policy and consumer uncertainty with a run of mostly positive economic data. It can be difficult to make hiring decisions in such an environment,” Richardson said in a statement.

Compensation costs rose by 0.9 percent for the second straight quarter in the first three months of 2025. Wages and salaries jumped by 0.8 percent while benefit costs jumped by 1.2 percent.

Layoffs could be appearing in the hard data.

Global recruitment firm Challenger, Gray, and Christmas reported that U.S.-based employers announced 105,441 job cuts in April, up by 63 percent from a year ago. Year-to-date, employers have announced 602,493 layoffs, although this has mainly occurred in the government.

“Though government cuts are front and center, we saw job reductions across multiple sectors last month,” Andrew Challenger, a senior vice president at the organization, said in a statement.

“Companies are generally pointing to economic uncertainty and the adoption of new technologies. Many employers are taking a wait-and-see approach, slowing hiring and scaling back plans as they assess developments in trade, supply chains, and consumer spending.”

In addition, initial jobless claims—the number of individuals who file for unemployment benefits for the first time during a reporting period—surged by 18,000 to a two-month high of 241,000 for the week that ended on April 26, according to the Department of Labor. Most of the increase was fueled by higher weekly jobless claims in New York (15,525) and Massachusetts (3,251).

Continuing jobless claims—people who are currently receiving unemployment benefits—also spiked to 1.916 million from 1.833 million. The four-week average, which removes week-to-week volatility, edged up to 226,000 from 220,500.