WASHINGTON—U.S. jobs growth for April was far lower than what the market had predicted, adding to worries that excessive stimulus payments could have undesirable side effects in the long term, making the road to recovery rocky.
The April jobs report was the biggest miss on record. According to the Bureau of Labor Statistics, the U.S. economy added 266,000 jobs last month versus an estimate of 1 million. The unemployment rate rose to 6.1 percent from 6.0 percent in March.
Some economists believe that the path to full employment could be much longer than expected.
“Going forward, U.S. job gains will be somewhat harder as they will depend on organic growth in demand and not just state and local governments easing of business restrictions,” Scott Anderson, chief economist at Bank of the West in San Francisco, wrote in a report.
The economy is still 8.2 million jobs below pre-COVID levels.
Job gains for March were also revised down to 770,000 from a blockbuster 916,000 additions. The unemployment rate for African Americans rose to 9.7 percent in April, making them the only racial group to experience worsening metrics, according to Economic Policy Institute. Meanwhile, the jobless rate for white workers fell to 5.3 percent.
While President Joe Biden inherited a strong economic recovery, his policies are hurting companies, especially Main Street businesses, critics say.
Business surveys show that the majority of small businesses are facing difficulties in finding workers. According to a monthly survey by the National Federation of Independent Business, a record level of small-business owners (44 percent) in April reported that they couldn’t fill job openings.
Many entrepreneurs have been complaining for months that they can’t compete with the unemployment benefits offered by the federal government.
The Biden administration’s new $1.9 trillion stimulus plan extended the weekly unemployment benefit at $300 through Sept. 6, 2021. In addition, the bill included a provision that made the first $10,200 in unemployment benefits received in 2020 nontaxable for households earning $150,000 or less.
BY EMEL AKAN