2024-04-05 17:46:26
4/5/2024-|Last update: 4/5/202408:28 PM (Mecca time)
Link copied! copy urlhttps://aja.ws/lvhvsp
The US jobs report on Friday showed that the number of new jobs last March rose at a pace greater than expected, with the economy ending the first quarter of the year in a good position, indicating the possibility of the Federal Reserve (the US central bank) delaying the decision to reduce interest rates this year.
The largest economy in the world created 303,000 jobs last March, an increase of more than 50,000 jobs compared to 270,000 jobs created the previous month, according to what the Ministry of Labor announced.
The increase, which comes 7 months before elections in which President Joe Biden and former Republican President Donald Trump will face off next November, is much higher than market expectations for an increase of 200,000 jobs, according to the Briefing website.
The unemployment rate fell to 3.8% from 3.9% last February, which is in line with expectations, to continue the streak of unemployment rate below 4%, which is the longest in decades.
A statement by the US President said, “The report issued today represents a milestone in the return (recovery) of the United States.”
15 million jobs since the beginning of Badin’s term
Biden said, “Three years ago, I inherited an economy on the brink of the abyss. With the report issued today stating that 303,000 jobs were created last March, we have crossed the threshold of 15 million jobs created since I took office.”
The wage growth rate increased by 0.3% on a monthly basis, while average hourly earnings increased by 4.1% from the previous year, and the labor force participation rate remained almost stable at 62.7%.
The largest share of jobs created was in the healthcare and government sectors, and to a lesser extent in the leisure and hospitality sectors.
The numbers reflect a slight decline in the unemployment rate in general, despite its increase among black Americans, noting that this increase was offset by a decrease among those of Asian and Latino origins.
Keep interest the same
There is a debate among decision makers at the Federal Reserve, headed by Jerome Powell, regarding the appropriate timing to begin lowering interest rates, amid efforts to return inflation to the target rate of 2% without harming the prosperous American economy.
Dan North, chief economist for North America at Allianz Trade, said in a statement, “It is a large number, and there is no debate regarding it,” referring to the creation of 303,000 jobs last month.
He added to Agence France-Presse, “Significant job growth, participation rates (in the labor force) are rising sharply, and unemployment is declining slightly. What more might Jerome Powell and the Federal Reserve ask for?”
Former Commissioner of the US Bureau of Labor Statistics Erica Groschen said the economy was “strong”, but she ruled out that it had fully recovered.
Groschen, an economic consultant at Cornell’s School of Industrial and Labor Relations, added, “This certainly does not indicate that interest rates are too high.”
“This would likely support postponing any (rate) cut for a little longer,” she added.
The inflation rate declined sharply last year, while the economy and labor market maintained their strength, but it has been taking an upward trend since the beginning of the year, which prompts some decision makers to delay the expected timing of the start of interest cuts.
For his part, North expressed his belief that “it is likely at this stage that the Federal Reserve will begin moving rates next July,” adding, “it seems too early (to move rates) next June.”
Recovery or higher borrowing costs?
Consistency in jobs data is beneficial for Biden, who stresses in his campaign that he has rebuilt the American economy in the post-pandemic phase.
But the Democrat still faces the challenge of persistent inflationary pressures on ordinary Americans, spurred by high interest rates.
If inflation remains above the target rate (2%), strong growth and jobs data will likely prompt the Federal Reserve to keep rates unchanged for longer, raising borrowing costs for consumers and producers.
This makes it more difficult for consumers seeking to buy a home or pay off credit card debt, and increases the financial burden on companies seeking to borrow to invest in the future.
“There is no president who does not want lower interest rates all the time,” North said, expressing his belief that the economic measures, although most of them are very good, “it is recognized that inflation remains what most concerns people.”
1712342617
#Job #growth #America #exceeds #expectations #unemployment #declines #Economy
