The U.S. Bureau of Labor Statistics issued an unexpectedly robust jobs report Friday, with employment increasing by 177,000 jobs for the month, while the unemployment rate remained unchanged at 4.2% despite cutbacks in the federal government and fears of a recession.
Professional and business services added 17,000 jobs but subtracted 9,000 jobs in accounting, tax preparation, bookkeeping and payroll services. Employment continued to grow in the health care, transportation and warehousing, financial activities and social assistance sectors.
However, federal government employment declined by 9,000 in April and is down 26,000 jobs since January. The Internal Revenue Service has reportedly experienced a 25% decline in its workforce, according to Moneywise, and recently issued layoff notices to employees in its Taxpayer Experience Office and its Office of Equity, Diversity and Inclusion in Taxpayer Services, according to NextGov. Over 300 IRS employees in the Independent Office of Appeals accepted voluntary buyouts under the IRS’s deferred resignation program, according to Bloomberg Tax.
Average hourly earnings rose 6 cents in April, or 0.2%, to $36.06. Over the past 12 months, average hourly earnings have increased 3.8%. But strong jobs report may be the last one for a while, according to one economist.
“The labor market has mostly shrugged off the impact of the April 2 tariff announcements and subsequent whipsawing in markets,” said Appcast economist Sam Kuhn in a statement. “The key question now: Is this the last ‘before’ jobs report? This week’s GDP figure showed the U.S. economy contracted for the first time since the first quarter of 2022. Will a contracting economy bleed into a weaker labor market? Consumer sentiment has cratered while inflation expectations have risen massively. Businesses are avoiding passing off price hikes to consumers for as long as possible in case trade policy changes.”
