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U.S. job growth disappointed in April, the Bureau of Labor Statistics said Friday, and the unemployment rate ticked up for the first time since peaking last April, as some employers blamed a labor shortage for hampering the market's recovery despite widespread vaccine availability and business reopenings.
Employers added just 266,000 jobs through the month, the fewest since January and far below the 1 million jobs gain forecast by the Bloomberg consensus. March's 916,000 increase was revised down to 770,000, raising concern about the underlying strength of the employment outlook.
Total private payrolls were up 218,000 when markets had expected a gain of 938,000. Notable job gains in leisure and hospitality (+331,000) were partially offset by employment declines in temporary help services (-111,400), professional and business services (-79,000), and transportation and warehousing (-74,100). Government payrolls were up 48,000, driven by a 31,000 increase in local government education as more schools transitioned from online to in-person learning.
Meanwhile, the unemployment rate inched up to 6.1% when markets had expected it to fall to 5.8%.That's the first time the unemployment rate has increased since peaking at 14.8% last April, the trough of pandemic job loss.
Among the unemployed, the number of people on temporary layoff was little changed at 2.1 million, as was the number of permanent job losers at 3.4 million.
The median duration of unemployment rose to 22.2 weeks from 21.6 weeks in March. Long-term unemployment, or those jobless for six months or more, was roughly unchanged at 4.2 million, accounting for 43% of the total unemployed. That's a slight improvement over March, when long-term unemployment made up 43.4% of total unemployment.
The number of people not in the labor force who currently want a job fell slightly to 6.6 million from 6.9 million in March, though was still up roughly 1.6 million from last February. These individuals were not counted in the official unemployment rate because they were not actively looking for work sometime in the last four weeks.
The U-6 rate, which accounts for discouraged workers, fell to 10.4% from 10.7% in March.
The participation rate continued to improve, rising to 61.7% from 61.5% in March. The employment-population ratio also increased, ticking up by a tenth to 57.9.
Average hourly earnings were up 0.7% through April, much stronger than the flat reading that had been forecast by Bloomberg. Some industry experts have said that higher wages are needed to coax hesitant unemployed workers back to the market.
From a year earlier, hourly wages were up 0.3%, and the length of the average workweek rose by a tenth to 35 hours.