April 2015 Employment Situation Report

The most recent report from the U.S. Bureau of Labor Statistics revealed that the job market rebounded throughout the month of April, contributing to a lower unemployment rate.

Job creation on the rise
Overall, the nation added 223,000 jobs during April. Although this was slightly lower than the 224,000 jobs projected by economists, it demonstrated a return to the positive growth trend seen over the last 12 months, compared to the 85,000 positions added in March. About 62,000 of these jobs were in the professional and business service sectors, which had been averaging just 35,000 new positions each month. Within this larger field, services to buildings and dwellings added 16,000 positions, computer systems design and related services added 9,000 jobs, business support services grew its workforce by 7,000 and technical consulting services expanded by 6,000 positions.

The healthcare industry created 45,000 jobs in April, with ambulatory care services gaining 25,000 positions, hospitals adding 12,000 jobs and residential care facilities expanding by 8,000 positions. The construction industry also experienced growth after having a stagnant March. The field gained 45,000 positions, with 41,000 of these jobs being specialty trade contractors. Transportation and warehousing gained 15,000 jobs. Sectors that saw little change in April included manufacturing, wholesale trade, information, retail trade, leisure and hospitality, government and financial activities.

Unemployment Rate and Job Creation

Unemployment rate ticks down
As a result of this significant job growth, the U.S. unemployment rate dropped slightly to an average of 5.4 percent. Bloomberg Business reported that this is the lowest jobless rate the country has seen since May 2008.

The BLS report revealed that wages grew as well. Average hourly earnings went up by 3 cents to $24.87, while average hourly earnings for private sector production and non-supervisory employees grew by 2 cents to $20.90. Bloomberg explained that while any compensation increases are a positive sign of growth, these minuscule expansions are unexpectedly low compared to rates of overall job growth.

“The pace of employment is quite encouraging. Wage growth is accelerating, but it’s quite gradual, more gradual than we would expect in a market where the unemployment rate is 5.4 percent,” Gregory Daco, head of U.S. macroeconomics at Oxford Economics USA Inc., told Bloomberg.

The New York Times reported that the April employment data suggests the Federal Reserve will not be in any rush to take it’s long-awaited first step in raising short-term interest rates, which have been near zero since the onset of the financial crisis in 2008. According to the source, most experts now expect the Feds to move in September or beyond as the probable beginning of any gradual tightening effort by the central bank.

View the full Bureau of Labor Statistics report here.

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MRI Employment Summary for January 2015

Employment Summary for
January 2015

January’s labor situation for the U.S. was more than just a single piece of good news, according to Bloomberg Business. The source said it marks a sea change in the labor market in which the middle class and working class are finally starting to get ahead. The unemployment rate increased slightly, but gains were still made across a variety of industries. Overall, economists noted that January’s numbers show impressive economic strength.

Unemployment rate rises slightly, but labor participation improves

A total of 257,000 jobs were added and the unemployment figure for the start of 2015 came in at 5.7 percent, a .1 percent increase from December’s rate of 5.6 percent. During January, the nation’s overall workforce grew by 703,000 people. This prompted labor force participation to increase slightly, from 62.7 percent to 62.9 percent.

Industries experiencing gains

Although the unemployment rate remained largely unchanged,  a number of sectors saw their payrolls rise. The retail industry saw the most growth, adding 46,000 positions. Within this sector, sporting goods, hobby, book, and music stores added the most jobs, although motor vehicle and parts dealers and non-store retailers also experienced notable growth.

The construction sector grew by 39,000 jobs, with gains in both residential and nonresidential building. Within the sector, specialty trade contractors employment trended up, added 13,000 jobs.

The healthcare sector, which has been steadily expanding for months, added 38,000 more jobs during the month of January. The majority of these positions came from doctors’ offices and hospitals, although gains were also seen in nursing and residential care facilities. Financial activities employed an additional 26,000 workers this past month, while the manufacturing industry grew by 22,000.

Other industries that experienced job creation were professional and technical services, which added 33,000 workers, and food services and drinking places which added 35,000 jobs.

Wages on the rise

Compensation rates increased in January, following a notable decline in December. While the end of 2014 saw a decrease of 5 cents, January’s average hourly wage went up by 12 cents, coming to $24.75. Average hourly earnings for private-sector production and nonsupervisory employees went up by 7 cents and currently rests at $20.80.

Fortune magazine noted that these much-welcome wage increases have been anticipated by economists. As compensation rates climb, it is more likely that the Federal Reserve will raise interest rates.

Numbers exceed economists’ expectations

Bloomberg reported that January’s report impressed economists, who had predicted  an increase of 228,000 jobs. While the unemployment rate climbed slightly, the source noted that it was likely due to the increasingly positive labor situation in the U.S., which has inspired more people to return to the workforce.

The source explained that inflation rates have been kept low due to increasingly weak overseas economies. Inflation is expected to continue to go down as 2015 continues, and industry professionals anticipate that the U.S. will soon have an unemployment rate as low as 5.4 percent.

The full Bureau of Labor Statistics report can be downloaded here.

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