Today’s jobs report is another scorcher, with large employment gains broadly spread across the economy. The addition of another 428k jobs in April brings the number of jobs added in just the first four months of the year to more than 2 million—a number that would have made for a healthy annual total before the pandemic.
Here are the key takeaways from the report:
- Both the service sector and manufacturing are rapidly adding jobs.
- Leisure and hospitality continued to post strong gains. But there is still room for further growth. There are still 1.44 million fewer jobs in that sector than before Covid, and restaurant dining, hotel occupancy, and air travel continue to pick up.
- The public sector is still lagging behind, both when it comes to employment and wage growth. Data from the Atlanta Fed Wage Tracker confirms that recent wage growth has been higher for non-unionized workers than for unionized workers. Expect public sector workers to demand sizable cost-of-living adjustments when they renegotiate their contracts. Improvements in public sector conditions could help that sector compete in the labor market and attract workers back.
- Workers are returning to offices rapidly now, reviving downtown businesses.
- In April, 7.7 percent of employed persons teleworked because of the coronavirus pandemic, down from 10.0 percent the prior month. The share of workers teleworking due to the pandemic has been decreasing steadily over the past 3 months as employers have called workers back to the office.
- Increased foot traffic in downtown areas is reviving downtown cafes and retail stores, increasing demand for rideshare drivers, and increasing activity at local gyms and entertainment businesses.
- Growth in average hourly earnings slowed to 5.5%, but the average is surely being dragged downwards by the rapid return of low-wage workers.
- That said, inflation is packing a punch and eroding wage gains for most workers.
- Nonetheless, non-supervisory employees in leisure and hospitality, and in transportation and warehousing, are coming out ahead, with annual wage growth of 12.6% and 11.2% respectively. In leisure and hospitality, those workers have now enjoyed double-digit year-over-year wage growth for 11 straight months.
