The unemployment rate breaks records in the United States. It has been five decades since it remained below 4% for 27 consecutive months. This was confirmed this Friday, despite the clear cooling of the labor market in the world’s largest economy. The index stood at 3.9%, one tenth more than expected, while in April the modest figure of 175,000 jobs was created.
This increase is well below the forecast of 240,000 made by experts. And even further from the average of 276,000 that had been recorded throughout 2024. It also contrasts with March, which was revised upwards to 315,000. The forecast was for the index to remain at 3.8%.
This result comes when a few days ago it was confirmed that the Gross Domestic Product (GDP) of the United States expanded at a much slower rate than expected in the first quarter of 2024. It increased by 1.6% in the annualized balance, while which had been predicted to reach 2.4%, after a rate of 3.4% in the previous period of 2023.
The labor market is showing a loss of energy as it enters spring, a turn that many economists had expected for months, after the vigorous resurgence of the pandemic, due to the impact of the restrictive policy of the Federal Reserve (Fed), which This Wednesday it kept interest rates at the highest level in 22 years in the face of the ebb of inflation.
Until now the Fed has been very cautious and has persisted in the high price of money as a result of this labor strength. Everything can change if this new downward trend is confirmed. Jerome Powell, president of the Federal Reserve, stressed at a press conference that the labor market continued to show great strength.
Salaries grew on average by 0.2% compared to March and by 3.9% in the annual comparison. Both data are below expectations. Analysts maintained that this dose of weakness in the labor market translates into lower wage pressure, one of the concerns expressed by the US central bank. Participation in the labor force did not change and remained at 62.7%.
Experts stressed that this does not mean that it is a sign of a bad economy. It remains healthy, they indicated, since it is part of a cycle in which a strong impulse cannot be sustained indefinitely. But there is no shortage of voices that still suggest a worsening.
Consistent with the current trend, the healthcare sector led in hiring with an increase of 56,000. Other sectors with good contributions were social assistance (31,000), transportation and storage (22,000) and retail trade (20,000).