Employers in the US added jobs in April for the 3rd time in 4 months, pointing to a recovery that is both broadening and gaining momentum.
Payrolls rose by 290,000, the most in three years, after increasing by 162,000 in March,
Companies from Caterpillar, Inc. to General Electric Co. are hiring as Americans spend more and businesses update equipment. Sustained job growth is required to propel consumer spending, which accounts for about 70% of the economy.
The April payroll figures received a boost from the hiring of temporary government workers to conduct the Y 2010 census, economists said. Even so, gains are projected in others areas like manufacturing.
The Labor Department report will probably show the unemployment rate was 9.7% for a 4th straight month, according to the survey median. The jobless rate has not increased since October, when it reached a 26-yr high of 10.1%. The economy lost 8.4M jobs since the Recession began in December 2007, the most of any downturn in the postwar era.
The US Federal Reserve officials restated their intention to keep the benchmark interest rate near Zero for an “extended period” and said the job market is strengthening.
“The labor market is beginning to improve,” policy makers said in an April 28 statement. “Growth in household spending has picked up recently but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit.”
The Labor Department’s employment report may also show a 15,000 gain in factory payrolls, according to the median estimate. Hiring is picking up as companies ramp up orders.
Manufacturing expanded in April at the fastest pace in more than 5 years, economists said before a May 3 report from the Institute for Supply Management. The Tempe, Arizona-based group’s factory index increased to 60, the highest level since June 2004, from 59.6, the survey showed. Index readings greater than 50 signal expansion.
Service industries expanded in April at the fastest pace in four years, economists said before a separate report from the Institute for Supply Management on May 5. The index of non-manufacturing businesses, which account for almost 90% of the economy, rose to 56 from 55.4 the prior month, the survey showed.
The US economy grew in Q-1 at a 3.2% annual rate, led by consumer spending and business investment, figures from the Commerce Department last week showed. Household spending climbed at a 3.6% pace, the most in 3years, compared with a 1.6% increase the previous 3 months.
Optimism that the economy will keep growing has helped lift stocks since March 9, 2009
Americans probably increased spending in March for a 6th straight month, a report from the US Commerce Department showed. Purchases climbed 0.6%t after a 0.3% gain the prior month, and incomes rose 0.3% after no change in February, the survey showed. Paul A. Ebeling, Jnr – www.livetradingnews.com
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