Friday’s jobs report from the Labor Department showed that last month’s hiring kept the unemployment rate at 3.6%, just above the lowest level in a half-century.
And the number of people in the labor force declined in April by 363,000, the first drop since September. Their exit slightly reduced the proportion of Americans who are either working or looking for work from 62.4% to 62.2%. Many industries have been slowed by labor shortages. The nation remains 1.2 million jobs shy of the number it had in early 2020, just before the pandemic hammered the economy.
For now, the resilience of the job market is particularly striking when set against the backdrop of galloping price increases and rising borrowing costs. This week, the Labor Department provided further evidence that the job market is still booming. It reported that only 1.38 million Americans were collecting traditional unemployment benefits, the fewest since 1970. And it said that employers posted a record-high 11.
“Trying to slow the economy just enough, without causing a recession," said Rubeela Farooqi, chief U.S. economist at High Frequency Economics. “Their track record on that is not particularly good."Giacomo Santangelo of the jobs research firm Monster is among economists who say they think a recession is coming. Even so, Santangelo said, the Fed “doesn’t have much of a choice’’ other than raising rates to combat the inflation spike.