The US unemployment rate fell to 3.9% in April, its lowest rate since December 2000, as employers stepped up hiring, modestly adding 164,000 jobs over the month.
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Although many employers now say it’s difficult to find qualified workers, they have yet to significantly bump up pay in most industries. Average hourly earnings rose 2.6% from a year ago, slightly below expectations.
The fall in the unemployment rate was also boosted by a drop in the labour force participation rate – the percentage of people who are currently employed or in search of a job. The participation rate dipped for the second straight month to 62.8% in April, near to levels previously seen in the 1970s.
Job gains occurred in professional and business services, manufacturing, health care, and mining, the labor department announced. Employment in professional and business services increased by 54,000. Employment in manufacturing increased by 24,000 in April.
The US has now added an average of 200,000 new jobs a month this year, continuing a record nine-year streak of month-on-month job gains.
But despite these gains, wage increases have barely kept pace with inflation.
“Continued slow wage growth tells us that employers still hold most of the cards, and don’t have to offer higher wages to attract workers. In other words, workers have very little leverage to bid up their wages,” Elise Gould, a senior economist at the Economics Policy Institute, wrote in a blogpost.