ABC NEWS
A worse-than-expected jobs report on Friday offered the latest evidence of an economic slowdown that could help ease inflation and trigger interest rate cuts. The trend, however, threatens to downshift the nation’s brisk economic growth.
Employers hired 175,000 workers last month, falling short of economist expectations of 240,000 jobs, U.S. Bureau of Labor Statistics data showed. The unemployment rate ticked up to 3.9%, which remains near a 50-year low.
The hiring in April marked a steep slowdown from the previous month and delivered the lowest monthly reading so far this year.
Economists who spoke to ABC News characterized the fresh data as a mild cooldown that may ease fears of stubborn inflation fueled by an economy running too hot.
The slowdown, they added, could help allow the Federal Reserve to cut interest rates this year without worrying about triggering a rebound of rapid price increases.
“This is the jobs report the Fed would have scripted,” Seema Shah, chief global strategist at Principal Asset Management, told ABC News.
“Of course, today’s weaker numbers need to mark the start of a new slower trend for multiple rate cuts to seriously be back on the agenda — but, by then, the new fear could be a slowing economy,” Shad added.
The major stock indexes ticked upward in early trading on Friday morning.
The cooldown in the job market matches a similar trend in another major measure of economic health: gross domestic product.
U.S. output slowed dramatically at the outset of 2024, though it continued to grow at a solid pace, U.S. Commerce Department data last week showed.
