The April jobs report delivered modestly positive news, with nonfarm payrolls rising 115,000. After several months of choppy data, the latest numbers suggest the labor market may be stabilizing, though at a slower pace than earlier in the recovery.
Revisions Cloud The Trend
Payrolls have bounced up and down in early 2026, making it a bit hard to read the labor market. We had negative payroll growth in February, and estimates for that month were revised down further to –156,000. Estimates for March were revised to be a bit more positive at 185,000. The 3-month estimate is now 48,000 — certainly not spectacular but a bit more solid than what we saw for 2025, when hiring was flat for a year.
Sector Gains And Losses Diverge
Job growth by sector was quite uneven. We saw major increases in healthcare (37,000) and social assistance (17,000), as well as transportation and warehousing (30,000) and retail trade (22,000). But there were moderate losses in information (-13,000), manufacturing (-2,000) and the federal government (-9,000), while most other sectors showed only modest growth.
Unemployment Rate Holds Steady
On the household side, the unemployment rate held steady at 4.3%. Modest increases were observed for adult men, teens, Black workers and Hispanic workers, while it declined for adult women. There are also a few other concerning numbers: job losses ticked up a bit (by 108,000), and the number of people working part-time for economic reasons rose by even more (445,000).
A Labor Market With Mixed Signals
Overall, the job market is steadier than we thought but hardly booming. Employment has now fallen by 92,000 in information and by 25,000 in professional services over the past year, which can hardly be very encouraging for young college grads. Whether these weak numbers reflect a growing influence of artificial intelligence on new hiring is not yet clear. And the increasing numbers of those who would prefer full-time work but are setting for part-time, as well as job losers, need to be monitored going forward.
Fed Likely To Hold Rates Steady
Still, the employment numbers will be viewed as being a bit more positive than they had been, with no signs of an economic downturn for now. The Federal Reserve will likely view inflation as the more immediate threat, with its preferred measure (the GDP Personal Consumption Expenditures deflator) rising 3.5% last year and 3.2% excluding volatile food and energy prices, well above its target of 2%. The war in Iran has not been settled, which will keep energy prices high for now.
All of this means that the Fed will likely keep interest rates steady as it monitors more developments. And the early reactions from the financial markets, as reflected in S&P futures, are mostly positive too. A job market with some weaknesses but still some moderate growth will be taken as good news, at least until we see more data on inflation and future payrolls.
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