Despite uncertainty in Donald Trump’s first two terms as president, the US economy added 177, 000 jobs in April, topping analysts’ expectations.
Despite Trump’s tariff campaign’s influence, the data, which was released on Friday by the Labor Department, suggests that the job market is stable.
The healthcare sector added 51, 000 jobs, which is the highest overall increase ever recorded in the previous 12 months. In April, 29, 000 jobs were created in the transportation and warehousing industries, respectively.
However, experts believe that particular growth in those sectors could indicate that those industries are stockpiling before Trump’s high tariffs start causing the price of imports to rise.
Before the tariff hike, “people wanted to front-load and bring in more material,” according to Stuart Mackintosh, the executive director of the Group of Thirty, a financial think tank.
Although the labor report from Friday shows positive signs, Mackintosh added that other economic indicators indicate general market uncertainty, which could eventually detract from upcoming employment statistics.
“Small and medium businesses have warned about their future earnings projections.” That’s what businesses are telling us, “We don’t know,” We don’t know for sure. And we anticipate that [earnings] will decline, Mackintosh said.
“I anticipate that will soon become a problem for employment.”
slowing down growth
Despite a number of changes since Trump took office in January, Friday’s labor report revealed that employment in the US has not changed.
Trump has pursued a stern trade policy for the past four months, largely under the threat of tariffs, to reduce trade deficits. The US currently imposes 10% tariffs on imports, with the possibility of putting higher tariffs on individual nations in the upcoming three months.
However, as a result of an ongoing trade conflict with the US, China is currently subject to tariffs of 145 percent. Meanwhile, Trump’s first term and the two countries that negotiated a regional free trade agreement have been subject to tariffs of 25% on all products.
Experts have warned that Trump’s erratic trade practices could have long-term detrimental effects, including stumbling economic growth and the possibility of a recession.
However, the report from Friday shows that there haven’t been any significant harms to the US labor market. In April, the unemployment rate remained at 4.2 percent.
4. 7 million people, or 7% of the workforce, are underemployed for economic reasons. 62.6 percent of people in the workforce participated in.
Additionally, wages increased by six cents to $ 36.06 since last month. Annually, the average hourly earnings have increased by 3.8%.
However, there are 179, 000 more Americans who have been unemployed for 1.7 million people overall over the long term, which are considered to be 27 weeks or longer.
However, other reports don’t show the same steady job growth. Only 62, 000 new jobs were added in April, according to ADP Research, a company that monitors private sector payrolls. This is the smallest monthly increase since July 2024.
Chief economist at ADP, Nela Richardson, stated that “unease” was the dominant emotion in a news release accompanying the findings.
Employers are attempting to reconcile policy uncertainty with a collection of largely positive economic data, she explained.
In addition, a separate report from Challenger, Grey &, Christmas, an employment services firm, revealed that despite increasing hiring, the US economy lost more than 105, 000 jobs in April.
Government reductions
Government employment was one area of the report that on Friday did indicate significant losses.
In April alone, the Labor Department reported a decline of 9, 000 jobs. Overall, it discovered that 26, 000 government employees have lost their jobs since January.
The Trump administration has been vocal about its goal of reducing the federal government, despite the report’s lack of speculative information.
The federal government had more than 2, 925, 000 employees in 2023 as the nation’s single-largest employer. However, Trump has engaged in a mass layoff strategy based on the idea that “waste, fraud, and abuse” characterizes the government.
Under the direction of tech billionaire Elon Musk, the newly established Department of Government Efficiency (DOGE) is in charge of streamlining the federal workforce.
By the end of the year, hundreds of thousands of federal employees will be laid off, but many DOGE cuts are currently being challenged in federal court and through initiatives like the Merit Systems Protection Board, which protects employee rights.
Some employees are therefore paid off. There is currently severance pay for some employees. In the context of April’s job report, neither group would qualify as “unemployed.”
A total of 282, 227 federal jobs have been cut so far this year, according to Challenger, Grey & Christmas’s report, the majority of which could be attributed to DOGE’s cuts. Since April 2024, the government job cuts have increased by 680 percent.
Key government functions have already been affected by the downsizing. Due to staffing cuts, the Food and Drug Administration was reportedly suspending a quality control program in its Food Emergency Response Network earlier this month, according to Reuters’ news agency.
a more severe economic downturn
However, additional effects from government cuts may be felt by the employment market.
Additionally, the Trump administration has attempted to reduce government spending and reduce grants, contracts, and foreign aid initiatives that use US businesses as private contractors.
Due to budget cuts to government agencies like the Department of Health and Human Services, experts believe the gains made in the healthcare sector this month could be temporary.
These departments frequently provide funding for research projects on behalf of universities and private companies.
“The administration has been cutting funding for research institutions, particularly in higher education.” According to Jessica Fulton, a senior fellow at the Joint Center for Political and Economic Studies, a think tank specializing in Black communities, “they’ve been cutting grants that have been given for grants for particular communities, for mental health services for children.”
Fulton remarked, “Those are job-sustaining investments.” In upcoming job reports, “We will see the impact of those]cuts.”
She also cited recent legislative changes in Congress that could cause a decline in healthcare employment.
In order to fund tax cuts and other party priorities, critics claim that the current Republican-led budget bill would require changes to Medicaid, the government’s program for low-income people.
According to Fulton, “Any potential program cuts, such as Medicaid, could threaten those jobs in the future.” We are “waiting and watching,” he said.
Other sectors are also getting ready for economic turbulence. Several businesses, including Stellantis and the social media tycoon Snap, suspended investor guidance this week. In light of uncertainty resulting from tariff-driven uncertainty, Stellantis already laid off 900 workers in April.
The US GDP decreased by 0.3% annually during the first quarter of 2025, according to a report from the Commerce Department, compared to a 2.4% increase in the fourth quarter of 2024.
Consumer confidence dropped 7.9 points in April according to a separate report released by The Conference Board, an economic nonprofit, on Tuesday.
According to Stephanie Guichard, a senior economist at The Conference Board, “Consumer confidence dropped for a fifth consecutive month in April, falling to levels not seen since the COVID pandemic first appeared.”
Source: Aljazeera
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