US Jobless Rate Falls to 3.9%, Lowest Since 2000

Donald Trump

The African-American unemployment rate dropped to 6.6 percent. It's been a frustration for many.

"Today's jobs report reinforces a number of themes we have emphasized: (1) USA growth is set to accelerate in Q2, even as the rest of the world may be slowing, (2) the unemployment rate is likely to drop faster than Fed expectations, and (3) despite strong economic growth and a low unemployment rate, inflationary pressure remains muted", Citibank said.

The Fed's preferred inflation measure, the personal consumption expenditures price index excluding food and energy, was up 1.9 percent year-on-year in March after a 1.6 percent rise in February.

But 236,000 people left the labour force in April. Some have found only part-time work. In turn, higher rates could provoke a stock market selloff. Black unemployment was the lowest on record and for women, it was the lowest since 2000.

The numbers paint a positive picture overall, though economists said there were reasons to worry as the job market continues to tighten. There's also scanty evidence that paycheck growth is accelerating; the average hourly wage rose a mere $0.04 in April.

"Factory orders have climbed in seven of the past eight months, and equipment spending, as reported in the gross domestic product report, has been supportive of topline growth in each of the past six quarters", said Tim Quinlan, senior economist at Wells Fargo Securities. Despite 3.9% unemployment, weak wage growth suggests that inflation may not be rearing its head in the U.S. economy. This also impacts wages in another way as the pool of available workers might not be as tight as it appears since the unemployment rate doesn't track people who have fallen out of the labor market because of long-term joblessness. "We expect the pace of job growth to be slowing because there's not going to be that many people to hire".

Knutec, a company in Bradenton, Florida, that builds communication network systems, hopes to double its 19-person staff in the next 60 days to meet demand from customers.

Mr. Gimbel said he had seen a particular hunger for new bodies in call centers, which offer candidates the minimum wage to deal with consumers' complaints about the gadgets they ordered online. "Why this tightness is not feeding into greater average hourly earnings growth remains a bit of a puzzle".

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President Donald Trump cheered the drop in the unemployment rate on Friday.

Much of the economy's durability is due, in fact, to the healthy job market. Total employment increased by 164,000 people. But in the last few years, the economy has strengthened considerably, which the president has worked to improve on even more.

Though that may soon change as employers seek to keep their workers by giving them higher wages. Restaurants and hotels hired 18,000 new employees.

Wholesaler and government were the only sectors to shed jobs.

With qualified job applicants harder to find in many industries, employers have become less and less likely to shed employees.

The unemployment rate fell down to 3.9 percent- its lowest point since 2000.

The trend reflects a decline in mass layoffs.

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