Analysts seemed to find little to be happy about in Friday’s monthly unemployment report, which showed that the U.S. economy added only 115,000 jobs last month. The jobless rate ticked down to 8.1 percent, but the decline is at least partly attributable to the fact that some Americans stopped looking for work.
(Read more: Pace of job growth falls off in the U.S.)
Sophia Koropeckyj, managing director at Moody’s Analytics, said in a statement that even though the nation’s economic recovery appeared steady, April was a “disappointing” month for the labor market. But she said the weak results were expected, “given the unusually warm winter, which resulted in fewer than usual layoffs and the moving up of some hiring that would normally occur in the spring. “
Ian Shepardson, chief U.S. economist with High Frequency Economics, also found the report disappointing but not especially surprising. He noted that the numbers tracked closely with a report on private-sector job growth earlier this week.
“The core story here, we think, is that higher energy prices have had a temporary dampening effect on hiring,” he said.
Steven Ricchiuto, chief economist at MSUSA, weighed whether the numbers might prompt the Federal Reserve to consider further action to boost the economy.
“These data points allow for more Operation Twist but not QE3,” he said, referring to a third round of ‘quantitative easing,’ in which the central bank buys up long-term Treasurys. The Fed has taken that action twice since the financial crisis to inject money into the economy.
Investors also reacted negatively to the data, with the Dow Jones industrial average, Nasdaq and S&P 500 indexes all dropping more than 1 percent in morning trading.
“After a frankly horrendous week in the Eurozone, the markets were looking to the U.S. for some comfort. They didn’t get it,” said Marcus Bullus, trading director at MB Capital. “An upward revision in previous months’ data will be of little consolation to the markets.”
Read more about the unemployment report and what it says about the pace of the economic recovery here.
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