April sees 253K jobs added in spite of Fed interest rate hike 

The Associated Press reported this morning that America’s employers added 253,000 jobs in April, evidence of a labor market that still shows surprising strength despite rising interest rates, chronically high inflation, and a banking crisis that could weaken the economy. 

April’s hiring gain compared with 165,000 jobs added in March and 248,000 in February and is at a level considered vigorous by historical standards. The unemployment rate ticked down to 3.4%, matching a 54-year low. 

The job market has remained strong despite the Federal Reserve’s aggressive campaign of interest rate hikes over the past year to fight inflation. Layoffs are still relatively low, and job openings comparatively high. Still, the ever-higher borrowing costs the Fed has engineered have weakened some key sectors of the economy, notably the housing market. 

The Fed has expressed concern that a robust job market exerts upward pressure on wages and prices. It hopes to achieve a so-called soft landing, cooling the economy and the labor market just enough to tame inflation yet not so much as to trigger a recession. 

One way to do that is for employers to post fewer job openings. The government reported this week that job openings fell in March to 9.6 million, a still-high figure but down from a peak of 12 million in March 2022, and the fewest in nearly two years. 

Another encouraging sign for the Fed is that more Americans are looking for work. The more workers who are available to employers, the less pressure employers face to raise pay.