Substantial gain in U.S. jobs for April
By Warren Vieth
Los Angeles Times
WASHINGTON — The U.S. economy posted a surprisingly strong gain of 288,000 jobs in April, providing convincing evidence that the recovery is finally producing results where it matters most to American workers.
Associated Press
The nation's unemployment rate edged down slightly to 5.6 percent from 5.7 percent in March, the Labor Department also reported yesterday.
David Bray, an unemployed accountant from Los Angeles, who is looking for a full-time position, awaits his turn for a job interview at the Robert Half International Inc., a specialized staffing firm in Los Angeles.
April's job gains — far surpassing economists' consensus expectations of a 170,000 rise — boosted President Bush's political fortunes heading into the final six months of the election campaign.
"It certainly suggests the jobless recovery is over," said David Wyss, chief economist at Standard & Poor's. "It's about as unambiguous as you can get."
However, fears that the strong report increases the chances of an imminent interest rate hike by the Federal Reserve sent stocks lower while bond interest rates rose. And the strong job news was partially offset yesterday by bad news on the inflation front, as oil prices surpassed $40 a barrel for the first time since October 1990, a move that will contribute to rising gasoline prices.
Yesterday's jobs report produced the eighth consecutive monthly increase in total employment, narrowing the nation's job loss since Bush took office to 1.5 million, compared with 2.6 million at last August's low point. If job growth continues at its current pace, which some analysts said they now considered possible, it could erase the remaining deficit by Election Day and rob Democrats of one of their central campaign issues.
"For the Republicans, this is manna from heaven," said Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, N.Y. "These payroll numbers are going to go from being very unhelpful to being very helpful very quickly."
Bush administration officials celebrated the new numbers, attributing them to the president's tax cuts.
"We got some good news today," Bush told a crowd outside the Grant County courthouse in Lancaster, Wis., one stop on a daylong bus tour through Iowa and Wisconsin. "We added 288,000 jobs last month. That's a good sign. Part of it has to do with making sure you get to keep more of your own money."
Democratic challenger John F. Kerry was quick to demur, noting that even with April's gains, 8.1 million Americans are still looking for work.
"Any step forward in the job market is good news for America's workers, but let's be clear: We still have a long way to go to get America working again," the Massachusetts senator said in a prepared statement.
Prominent Democrats said they did not think several months of job growth would devalue the economy as an election issue.
"The job creation is a positive for the president, you can't deny that," said New Mexico Gov. Bill Richardson, who was attending a Democratic Leadership Council convention in Phoenix. "But I think the concern that most people have in their daily lives about the economy — gas prices, job loss overseas — is still working against the president."
"The reality is we're still going to be a couple million jobs lower than when Bush took over," said DLC founder Al From.
The robust job figures caught many analysts by surprise. The consensus prediction of economists polled in advance by Bloomberg News was a monthly gain of 170,000 and an unemployment rate of 5.7 percent. The highest estimate offered by any of the 75 analysts surveyed was 250,000.
Economists scrambled to revise their estimates of future job creation and the timetable for interest rate increases. Some said they now expected the Federal Reserve Board to begin boosting short-term interests rates next month to ensure the accelerating recovery does not rekindle inflation.
The prospect of looming rate hikes rattled financial markets. The interest rate on 10-year Treasury notes rose to 4.77 percent, up from 4.60 percent the day before and its highest level since July 2002. Fed officials said Tuesday that they intended to begin raising short-term rates at a "measured" pace, and some analysts had predicted that the first hikes were still months away.
Now, a June rate hike looks far more likely, analysts said.
