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US adds 115,000 jobs in April, fewer than expected

Category: Business

Published: 4th May 2012 15:47:58

The US economy created 115,000 jobs during April, down on the previous month and fewer than analysts had expected, official figures have shown.

However, the unemployment rate fell slightly to 8.1% from 8.2% in March, the Labor Department said.

Employment has been rising for the past eight months, but the jobless rate has been stuck above 8% since early 2009.

The stubbornly high unemployment rate is seen as a drag on economic growth in the US.

Jobs were created in the business services, retail and healthcare sectors in April, but were lost in transport.

The Labor Department said the number of long-term unemployed was "little changed at 5.1 million".

The unemployment rate hit a three-year low, but part of the reason for the fall was a drop in the number of people looking for work, which reduced the size of the workforce.

"The drop in the unemployment rate was actually an unhealthy drop - you had less people looking for work, which shows a bad sentiment," said Ron Florence at Wells Fargo Private Bank.

Alan Kreuger, chairman of President Obama's council of economic advisers, pointed to the fact the economy had added private sector jobs for 26 straight months, despite "adverse shocks" that had hindered growth.

But he added: "We need to do more, which is why the president has laid out his blueprint for an American economy that is built to last and will continue to urge Congress to act to do more to grow the economy and create jobs. "

Andrea Saul, a spokesperson for Republican presidential candidate Mitt Romney, said, "President Obama has broken countless promises during his time in office - but none more important than his promise to help create jobs and get our economy moving again."

The US saw two consecutive months of robust jobs growth in January and February, with increases of well over 200,000 jobs in both months.

But the past two months have seen a sharp fall in job creation, with 154,000 jobs added in March, a figure revised up from 120,000.

Analysts had expected a rise in April.

"We're still growing just gradually," said Nigel Gault at IHS Global Insight in Massachusetts.

"Hiring is coming back into line with what you would expect with sluggish growth."

The weak jobs report pushed shares on Wall Street lower, with the Dow Jones index dropping 53 points, or 0.4%, 13,154.

Meanwhile, the oil price continued to fall, with US light crude dipping below $100 a barrel on concerns about the strength of the world's largest economy.

Last week, official figures showed that US economic growth slowed to an annualised rate of 2.2% in the first three months of the year, down from 3% in the final quarter of last year.

The Commerce Department said a cut-back in business investment was the key reason for the slowdown in growth.

The Federal Reserve expects economic growth of between 2.4% and 2.9% in 2012, with an unemployment rate of between 7.8% and 8%.

Source:
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BBC News, 2012. US adds 115,000 jobs in April, fewer than expected [Online] (Updated 4th May 2012)
Available at: http://www.ukwirednews.com/news/1426598/US-adds-115-000-jobs-in-April-fewer-than-expected [Accessed 23rd Apr 2014]

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