U.S. job growth was significantly lower than expected in April, perhaps signaling a reversal in employment trends that have been hurting the Federal Reserve's fight against inflation.
In fresh jobs data released Friday, nonfarm payrolls increased by 175,000, well below the 240,000 forecast by the Dow Jones. It was the weakest number since October 2023.
Private sector payrolls came in at 167,000, the labor force participation rate held steady at 62.7%, and both the unemployment rate and the average hourly earnings rate came in at 3.9%.
The numbers were encouraging for investors, who reacted positively to the news. All three major indices saw pre-market gains as investors hope the report signals a turning point in the economy.
The Fed has kept interest rates at a 23-year high while trying to fight persistent inflation. The central bank is looking for signs that inflation is cooling toward its target of 2%.
Health care led all sectors with 56,000 jobs added, followed by social assistance (31,000), transportation and warehousing (22,000) and retail (20,000).
