The Times West Virginian

Headline News

May 4, 2013

Solid job gains in April ease fears about economy

WASHINGTON — The U.S. economy showed in April that it’s healthier than many had feared, adding a solid 165,000 jobs and driving the unemployment rate down a notch to a four-year low of 7.5 percent.

Not only that, but many more people were hired in February and March than previously thought, the Labor Department said Friday.

The job gains came despite a global slowdown, Social Security tax increases and federal spending cuts that some had feared would be a drag on the economy.

The stock market soared on the news, with the Dow closing up 142 points, or nearly 1 percent, after briefly breaking 15,000 for the first time in history.

Coming after a poor jobs report for March, the figures helped ease fears that U.S. hiring might be slumping this spring for a fourth straight year.

“All things considered, 165,000 isn’t the biggest monthly gain in payrolls you’ll ever see, but it’s enough to assuage concerns that the economy had stalled again,” said Paul Ashworth, an economist at Capital Economics.

The Labor Department revised upward its estimate of job gains in February and March by a combined 114,000. It now says employers added 332,000 jobs in February and 138,000 in March.

The economy has created an average of 208,000 jobs a month from November through April — well above the monthly average of 138,000 for the previous six months.

The job market is benefiting from a resurgent housing market, rising consumer confidence and the Federal Reserve’s stimulus actions, which have helped lower borrowing costs and lift the stock market.

The unemployment rate edged down from 7.6 percent in March and has fallen 0.4 percentage point since the start of the year, though it remains high. The Fed has said it plans to keep short-term interest rates at record lows at least until unemployment falls to 6.5 percent.

One cautionary note in the employment report: Most of the biggest job gains were in lower-paying fields, such as hotels and restaurants, which added 45,000 jobs, and retail, which added 29,000. Temporary-help firms gained 31,000 positions.

By contrast, construction companies and governments cut jobs. Manufacturing employment was flat.

Some higher-paying sectors added workers. Professional and technical services, which include accounting, engineering and architecture, added 23,000 jobs. Education and health services gained 44,000.

Average hourly pay rose, but the average workweek for private-sector employees dipped 0.2 hour to 34.4 hours. That meant average weekly paychecks declined.  

But over the past year, total pay after adjusting for inflation is up a healthy 2.1 percent, economists said. That should help boost consumer spending in coming months.

The job growth is occurring while the U.S. economy is growing modestly but steadily. It grew at a 2.5 percent annual rate in the January-March quarter, fueled by the strongest consumer spending in two years.

The housing recovery is helping drive more hiring. Rising home sales and construction create jobs and increase spending on furniture, landscaping and other services.

One company that has benefited is SolarCity, based in San Mateo, Calif. Rising home building has helped increase demand for the solar-power systems the company installs in homes and businesses.

CEO Lyndon Rive said SolarCity added 177 jobs in April and will welcome its 3,000th employee Monday. It is hiring engineers, installers and administrative support staff and still has 400 openings.

Consumers have been spending more even though their take-home pay was shrunk this year by a Social Security tax increase. On top of that, the economy has been under pressure from the across-the-board government spending cuts that began taking effect March 1. And some small and midsize companies are concerned about new requirements under the federal health care law.

Americans’ confidence in the economy jumped last month, lifted by a brighter outlook for hiring and expectations for higher pay, according to the Conference Board, a research group. Cheaper gasoline, the booming stock market and rising home values are also no doubt making people more confident.

Home prices rose 9.3 percent in February compared with a year ago, the most in nearly seven years, according to the Standard & Poor’s/Case-Shiller 20-city index.

Still, prices nationwide remain about 30 percent below their peak during the housing bubble in 2006. They’re back only to where they were in 2003.  

Yet the global economy, by contrast, is slowing. The European Union warned Friday, for example, that the 17 countries that use the euro will shrink by a collective 0.4 percent this year. And unemployment in the eurozone is expected to hit an average of 12.2 percent. In Greece and Spain, it is forecast to reach 27 percent.

In April, more Americans said they had part-time jobs even though they wanted full-time work. That figure rose 278,000 to 7.9 million, reversing a steep drop the previous month.

Some economists worry that restaurants, retailers and other companies are hiring more part-timers in preparation for the start of health care reform. Companies with more than 50 full-time employees in 2013 will be required to provide health insurance to their full-time staff next year.

The revisions to the March and February figures were unusually large. Retailers, restaurants and hotels added 48,000 more jobs in February than previously reported. They accounted for three-quarters of that month’s revision.

The government revises each month’s job totals twice in the following two months. The revisions occur because many companies in the survey submit their responses late.

Friday’s report said the number of people who have been unemployed for more than six months dropped 258,000 to 4.4 million. Over the past year, the number of long-term unemployed has declined by 687,000.

Some analysts cautioned that April’s job gains don’t necessarily point to faster hiring ahead.

“There is little sign in these data to suggest that a marked acceleration in monthly job creation in the months ahead is in the cards,” said Scott Anderson, chief economist at Bank of the West.

1
Text Only
Headline News
  • What’s a group selfie? An usie

    What do you call a group selfie? An usie, of course!

    July 30, 2014

  • Senate changes House bill for highway funds

    The Senate on Tuesday voted to change the funding and timing of a House bill to keep federal highway funds flowing to states in an effort to force Congress to come to grips with chronic funding problems that have plagued transportation programs in recent years.

    July 29, 2014

  • State close to national average in credit card debt

    Credit card debt may have reached its lowest level in a decade, but according to a recent study on personal debt vs. income, just as more people are paying off their credit card debt monthly, nearly the same number of people are being reported for unpaid bills.

    July 29, 2014

  • New VA secretary confirmed by Senate

    The Senate on Tuesday unanimously confirmed former Procter & Gamble CEO Robert McDonald as the new Veterans Affairs secretary, with a mission to overhaul an agency beleaguered by long veterans’ waits for health care and VA workers falsifying records to cover up delays.

    July 29, 2014

  • W.Va. man arrested after child found in hot car

    A Wheeling man faces charges that he left his 18-month-old daughter in a hot car while he was asleep on a couch.

    July 29, 2014

  • Board to meet on dangerous animals list

    CHARLESTON (AP) — A board tasked with compiling a list of animals that are illegal to keep as pets in West Virginia will consider one that’s shorter than a list suggested earlier.

    July 28, 2014

  • Clinton impeachment shadows GOP lawsuit against Obama

    The last time Republicans unleashed impeachment proceedings against a Democratic president, they lost five House seats in an election they seemed primed to win handily.

    July 28, 2014

  • Study: Fist bumps less germy than handshakes

    When it comes to preventing the spread of germs, maybe the president is on to something with his fondness for fist bumps.

    July 28, 2014

  • Obama Exporting Pollu_time.jpg ‘Not in my backyard’: U.S. sending dirty coal abroad

    As  the Obama administration weans the U.S. off dirty fuels blamed for global warming, energy companies have been sending more of America’s unwanted energy leftovers to other parts of the world where they could create even more pollution.
    This fossil fuel trade threatens to undermine President Barack Obama’s strategy for reducing the gases blamed for climate change and reveals a little-discussed side effect of countries acting alone on a global problem. The contribution of this exported pollution to global warming is not something the administration wants to measure, or even talk about.

    July 28, 2014 1 Photo

  • U.S.: Russia fired rockets into Ukraine

    Stepping up pressure on Moscow, the U.S. on Sunday released satellite images it says show that rockets have been fired from Russia into neighboring eastern Ukraine and that heavy artillery for separatists has crossed the border.
    The images, which came from the U.S. Director of National Intelligence and could not be independently verified by The Associated Press, show blast marks where rockets were launched and craters where they landed. Officials said the images show heavy weapons fired between July 21 and July 26 — after the July 17 downing of Malaysia Airlines Flight 17.

    July 28, 2014

House Ads
Featured Ads