US adds 115,000 jobs in April as hiring cools but labor market stays resilient

US hiring slowed in April but held up better than feared, the Bureau of Labor Statistics reported on May 8, in a release that pointed to a labor market gradually cooling without rolling over. Nonfarm payrolls rose by a seasonally adjusted 115,000, down from an unusually strong 185,000 in March but comfortably above the roughly 55,000 economists had penciled in. The unemployment rate held at 4.3%.

The steady jobless rate, despite the slower pace of hiring, reflected a labor market that has reached a kind of equilibrium in which only modest job creation is needed to keep unemployment stable, given limited growth in the workforce. The labor force shrank again during the month, a recurring feature of what economists have described as a low-hire, low-fire environment that has persisted since early 2025, in which employers are reluctant both to add staff aggressively and to cut existing positions.

The composition of the gains was familiar. Health care led the way with around 37,000 new jobs, followed by transportation and warehousing and by retail trade. Offsetting some of those gains, federal government employment continued its decline, the information sector shed positions in another sign of weakness in tech-related hiring, and manufacturing edged lower. The result was a report that, while positive at the headline level, carried several undercurrents pointing to a potential slowdown later in the year.

Wage data offered a dovish counterpoint to the inflation worries dominating the macro backdrop. Average hourly earnings rose just 0.2% on the month and 3.6% from a year earlier, both below expectations, suggesting that wage pressures were not adding meaningfully to the energy-driven inflation working its way through the economy. For policymakers anxious about a wage-price spiral, the soft earnings figure was a modest reassurance.

The report notably marked the first back-to-back monthly increase in payrolls in nearly a year, a sign that the labor market remained on a steadier footing than some of the gloomier forecasts had implied. Even so, analysts characterized the broader trend as one of stability bordering on stagnation, with the job market having been roughly flat in its underlying dynamics for the better part of a year and a half.

For the Federal Reserve, the April figures complicated an already delicate calculus. With inflation accelerating on the back of the conflict-driven energy shock, a labor market that was cooling only gradually gave officials little reason to consider easing, while the absence of a sharp deterioration meant there was no urgent case for support either. The data reinforced expectations that the central bank would remain on hold, watchful and focused on the price side of its mandate.

Markets digested the release as broadly consistent with that wait-and-see stance. A jobs print that beat low expectations but showed clear signs of moderation did little to shift the rate outlook decisively in either direction, leaving the dollar and Treasury yields to take their cues primarily from the inflation data and the evolving situation in the Middle East.

Taken together, the April employment report depicted a labor market absorbing the strains of higher energy costs and elevated borrowing costs without buckling, expanding modestly while showing pockets of weakness in tech, manufacturing and the federal workforce. For an economy navigating a geopolitical shock, the steadiness of hiring offered a measure of resilience, even as the slowing pace and shrinking labor force hinted at the challenges building beneath the surface.