The U.S. economy added 177,000 jobs in April

The U.S. economy added 177,000 jobs in April exceeding expectations and slightly above the 12-month average of 152,000.

Unemployment & Labor Force Participation

Both the unemployment rate and the labor force participation rate held steady at 4.2% and 62.6% respectively indicating a relatively stable job market. Roughly 168.8 million people were in the labor force in April, up slightly from 168.7M in March. 

The long-term unemployed (jobless ≥27 weeks) rose to 1.7 million (23.5% of all unemployed) while the broad underemployment rate was about 7.8% in April. These data suggest a tight labor market with steady hiring in key sectors, while lingering underutilization (long-term unemployed and part-time for economic reasons) remains a consideration for HR and recruitment planning.

Industry-Specific Job Gains and Losses

Job growth remains concentrated in services whereas goods-producing employment barely budged (+0.3% YOY): 

• Health care (+51K) - in line with the 12-month average of +52K/month for health care, reflecting strong ongoing demand for health services.

• Transportation/warehousing (+29K)

• Financial activities (+14K)

• Social assistance (+8K). 

Employment was essentially flat in other major sectors–manufacturing, construction, wholesale/retail trade, information, professional/business services, leisure and hospitality, and other services–suggesting broad stability outside the highlighted growth areas

As expected, Federal government payrolls fell again in April (-9K), but state/local gains largely offset the losses (total government +10K). 

Earnings and Workweek Trends

Wage growth was modest – average hourly earnings on private payrolls rose 0.2% in April (to $36.06) and +3.8% over the past year – supporting steady but below-inflation real wage gains. This implies moderate wage inflation: compensation is rising, but not at double-digit rates. Employers should expect salary and benefit costs to grow mid-single-digit percentages. Tighter labor markets in healthcare and tech could push pay higher in those industries, while stability in retail and services may keep raises modest.The average workweek remained 34.3 hours, unchanged from March.

Key Insights from External Sources

CNN: What seems like a perfect report shows what could have been for the US economy before the tariff bite,” Gregory Daco, chief economist at EY-Parthenon, told CNN’s Matt Egan on Friday. “Tariffs only started to bite later in the month, so the demand and employment shock will be more visible in the May-June data.

New York Times: The 29,000-job increase in transportation and warehousing is interesting. The sector has been accelerating in recent months, in a potential sign that employers have been rushing to move goods ahead of tariffs.

NBC News: Over the past 12 months, just three sectors have accounted for about 80% of all job growth, according to Vanguard financial group: government, health care and social assistance, and leisure and hospitality. The first two face pressure from DOGE cuts, while leisure and hospitality jobs are vulnerable to Trump’s immigration crackdown.

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