US unemployment has fallen to its lowest since 2008 after the economy added 223,000 jobs in April taking the unemployment rate down to 5.4% – close to the rate the Federal Reserve considers to be effective full employment.
The jobless rate fell from 5.5% to 5.4% the lowest since May 2008 – before the financial crisis struck – in a signal that companies are confident about the strength of the US economy.
The Labor Department said 223,000 people joined the workforce in April, slightly lower than expectations of 225,000 but much higher than the 85,000 job gain in March – which was the smallest increase since June 2012.
The new figures take the number of US jobs added over the last 12 months to 3m. However, average hourly wages only grew by only 3% in April, taking year-on-year gains to 2.2%.
The drop in the unemployment rate takes it close to the 5.0-5.2% range that Federal Reserve officials consider to be consistent with full employment, and raises the prospect that the Fed may increase interest rates later this year. The US central bank has kept interest rates near zero since December 2008.
Fed officials, who in March dropped a promise to be “patient” about raising rates, meet next to consider raising rates on June 16-17 but most experts expect rates to be held until later in the the year.
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