Economists see ‘virtuous cycle’ in job growth
WASHINGTON – American companies are on a hiring spree.
Businesses delivered a jolt of strength to the economy by creating 268,000 jobs in April, the biggest monthly total in more than five years. The gains were solid across an array of industries, even beleaguered construction.
It was the third month in a row of at least 200,000 new jobs. The private sector has added jobs for 14 consecutive months. Even a slight rise in the unemployment rate to 9 percent appears to be a quirk.
The job growth was better than economists expected and perhaps the strongest sign yet that what they call a “virtuous cycle” has taken hold: When people spend more, corporate earnings rise, leading to more hiring and then more spending.
“This was really a good report because ultimately it is all about jobs,” said Joel Naroff, president of Naroff Economic Advisors. “More and more, it is looking as if the recovery is on track despite the headwinds it is facing.”
Those include higher prices for crude oil and gas. But energy prices fell sharply earlier this week, apparently reflecting lower consumption in the United States and a stronger dollar. The rise in the unemployment rate, to 9 percent in April from 8.8 percent the month, was the first increase since November. But it appeared to be because of a temporary disparity in two surveys the government uses to track jobs.
Wall Street was pleased by Friday’s report from the Labor Department. The Dow Jones industrials rose more than 150 points shortly after the opening bell. The Dow closed up 55 points.
Businesses added jobs in April across the economy. Retailers, factories, financial companies, education, health care and the construction industry all reported gains.
And the government said the job gains it reported for March and February turned out to be even stronger than previously thought.