US economy adds 288,000 jobs in April; unemployment down to 6.3%

02 May 2014 15:35 Source:ICIS News

HOUSTON (ICIS)--US job growth surged in April, as non-farm payrolls expanded by 288,000 and the unemployment rate dropped 0.4 percentage points to 6.3%, the Department of Labor announced on Friday.

Economists had estimated an increase of 210,000 new jobs in April and a 6.6% unemployment rate.

The unemployment rate had shown little movement in 2014, having started the year at 6.6% in January but ticking up in February to 6.7% and remaining there until April.

The downturn in the unemployment rate went hand-in-hand with a sizeable drop in April in the number of unemployed persons, which fell 733,000 from March to 9.8 million.

The department’s report showed that job growth was widespread across industries, including in professional and business services (75,000 new jobs), retail trade (35,000), construction (32,000) and healthcare (19,000).

The number of long-term unemployed – those jobless for 27 weeks or more – fell by 287,000 in April to 3.5 million, and they accounted for 35.3% of those unemployed.

Not all of the data was upbeat, as 806,000 people dropped out of the civilian workforce in the month, following an increase of 503,000 in March. The labour participation rate fell 0.4 percentage points to 62.8%.

Prior to the 2008-2009 recession, the workforce participation rate was 66%.

Economists say that the US must add 150,000 new jobs each month just to accommodate young people entering the workforce for the first time. To make any serious headway in lowering the nation’s unemployment numbers, jobs growth should be at or above 300,000 each month for multiple quarters.

By Jeremy Pafford