According to the US Department of Labor’s April jobs report, the national unemployment fell to 4.4%, reaching its lowest level since May 2007. Approximately 211,000 jobs were added in April, helping to compensate for disappointing numbers from March, helping America draw nearer to “full employment.”
The 4.4% unemployment rate is considered a strong sign regarding how far the national economy has come since the end of the Great Recession in 2009, a point when unemployment had reached the 10% mark.
Chief investment strategist at State Street Global Advisors, Michael Arone, referred to the report as “very strong” saying, “We’re nearing full employment in the US economy,” and many economists agree.
As reported by CNN, full employment occurs when the unemployment rate reaches a level where it won’t likely dip much further. When it occurs, employers have difficulties finding workers, which can lead to wage growth.
When compared year over year, wages grew 2.5%, a significant improvement over previous years. However, the Federal Reserve would prefer to see that number reach closer to 3.5%.
Cathy Barrera, the chief economic advisor at ZipRecruiter, said, “The unemployment rate is even lower than expected. We’re seeing continued wage growth. To me, these are all good sign.”
The April jobs report is the third such report to be released since President Donald Trump took office. Over that time, the US economy has gained around 522,000 jobs. While Trump has openly taken credit for the improvements, job growth is influenced by a wide range of factors, many of which are outside the control of the president.
Improvements were also noted in the level of US underemployment, a category that includes citizens with part-time employment who would prefer to work full-time or those within certain stages of the unemployment process. The U-6 rate, the largest measure of underemployment, came in at 8.6%, far below the 17% recorded in 2010.
Job growth occurred across most sectors including healthcare, hospitality, business services, manufacturing, and construction. Many experts attribute the positive growth to the current health of the larger global economy.
Speaking about the gains in manufacturing, Arone said, “If you are a manufacturing executive, you’re not adding employees based on hopes alone.” He continued, “It’s based on more of a global growth trade than it is on the optimism regarding the Trump administration’s policies,” referring to the president’s promises regarding deregulation, infrastructure improvements, and tax cuts.
Based on the positive report, the Federal Reserve is expected to consider another rate hike, similar to those that occurred in December and March.