Jason Furman, Wilson Powell III
Τhe economy added 428,000 jobs in April, a slight slowdown from the pace in recent months. The unemployment rate stayed at 3.6 percent as the labor force participation rate fell and broader measures of unemployment rose. The big news in the Labor Department’s jobs report was that average hourly earnings were up only 0.3 percent, bringing the annualized increase over the last three months to 3.8 percent (adjusted for compositional changes). This is considerably slower than the pace of nominal wage growth in 2021 and, if it holds up, would indicate that labor markets may be considerably cooler than previously appreciated—reducing the underlying pressure on inflation.