US April Payrolls Rise 115,000, More Than Double Estimates

Data bolsters case for Fed rate hold

U.S. nonfarm payrolls rose by more than twice as much as markets expected in April, defying forecasts that the labor market would weaken amid the U.S.-Iran war and recession concerns.

The Bureau of Labor Statistics said on May 8 that nonfarm payrolls increased by 115,000 in April. That followed a gain of 185,000 in March, marking a second straight month of solid growth. Before the release, Dow Jones and Bloomberg had forecast increases of 55,000 and 65,000, respectively. The unemployment rate was unchanged at 4.3%.

Markets had expected a sharper slowdown in the U.S. labor market as surging oil prices tied to the Middle East war and softer corporate investment weighed on the outlook. Instead, stronger-than-expected job growth fueled optimism that the U.S. economy remains more resilient than anticipated.

Average hourly earnings rose 0.2% from a month earlier, below the market estimate of 0.3%. After the jobs data, New York stock futures rose, Treasury yields fell and the dollar weakened.

The report is also set to influence the Federal Reserve's next rate decision. The Fed is expected to leave rates unchanged as it considers inflation risks linked to the Middle East war. Stronger-than-expected employment data added support to that view.

Still, a prolonged war in the Middle East remains a variable. If surging oil prices intensify inflation pressure, consumer sentiment could weaken. If softer consumption and rising costs persist, companies may cut working hours or reduce headcount.

Son Ju-hyung, Hankyung.com reporter, handbro@hankyung.com