Economy Watch: Employment Gain More Modest in April

The National Association of Realtors said that homes sold at a solid annual pace of 5.6 million in March, even though the number of houses for sale has plunged. Trump said on Twitter, also denouncing a continuing investigation into his campaign’s ties to Russian Federation. Continuing a trend that has been present for much of this cycle, policy makers are likely to further reduce their estimate of the longer-run unemployment rate in the near term. Unemployment dropped to 3.9%, the lowest since December 2000.

Some 236,000 U.S. workers left the workforce in April, which the Wall Street Journal suggests is the catalyst for the low unemployment headline number.

The last time America’s unemployment rate was this low, “Smooth” by Santana was topping the charts, and officials were still counting “hanging chads” in Broward County, Florida. Meanwhile, on Thursday, weekly jobless claims data revealed that unemployment aid for Americans was at its lowest levels in more than four decades.

The legal sector employed 1,136,300 people in April, according to the monthly jobs report from the Department of Labor’s Bureau of Labor Statistics.

That pushed down the participation rate, or share of working-age people in the labor force. The Labor Department reported Friday that it fell to 3.9% – inching closer to territory not seen in half a century.

“We do expect wages to accelerate throughout the year, gradually”, said Jeremy Schwartz, vice president of economics at Credit Suisse.

Construction payrolls rebounded by 17,000 jobs last month after recording their first drop in eight months in March. “This suggests that, in spite of the low unemployment rate, workers are still not confident about their labor market prospects”, writes Baker. But is it enough to force up wages? The smaller pool of available workers usually leads to increased wages because companies have to compete to hire people. We don’t know what is normal, high or low.

“We have had some improvement in the a year ago”, Vedder said. So, either our measures are missing the point or there really isn’t a labor shortage. It was the seventh consecutive month with robust growth in hiring in the sector, averaging 26,571 per month over that time frame. “The three percent growth ideal seems plausible right now”. It began falling after several years of steady growth in 2000.

Does this mean the economy is at full employment?