US economy adds 115,000 jobs in April despite Iran war

An important development from the financial markets: US economy adds 115,000 jobs in April despite Iran war 15 minutes ago Share Save Add as preferred on GoogleArchie MitchellBusiness reporterGetty ImagesThe US economy created 115,000 jobs in April as businesses kept hiring despite the economic fallout from the US-Israel war in Iran. The increase was stronger than expected, with the total almost twice as much as economists had forecast. The data, published by the US Bureau of Labor Statistics (BLS), also showed the unemployment rate was unchanged at 4.

The closure of the Strait of Hormuz in response to US and Israeli strikes on Iran has sparked a global energy shock, pushing up the price of gasoline for American consumers. The latest figures come after months of big fluctuations in job numbers. Non-farm payrolls fell by 156,000 in February before rising by 185,000 in March.

Economic Details

April's solid employment figures added to expectations the Federal Reserve will keep interest rates on hold as it seeks to keep a lid on inflation. Revisions to March and February's figures mean the number of jobs rose on average by 48,000 over the last three months. That is in line with the so-called breakeven rate, the level of job creation at which new people entering the workforce can be absorbed.

Economists said the figures were encouraging, pointing to a particularly strong showing in the retail and transportation and warehousing sectors. "Both give relatively positive signals about the health of discretionary spending, despite the hit to consumers' purchasing power from higher gasoline prices," said Thomas Ryan, North America economist at Capital Economics. But he pointed to "mixed signals" elsewhere in the report, including slow wage growth and an overall contraction in the jobs market, with fewer working-age people seeking employment.

"All that being said, this was ultimately a positive employment report that reinforces the view that the labour market is stable and potentially even accelerating," he said. But Samuel Tombs, chief US economist at Pantheon Macroeconomics, said job growth was likely to start to slow in the coming months. He said recent survey data pointed to a slowdown in hiring and that the unemployment rate could rise from 4.

7% by the end of the year, prompting the Federal Reserve to begin cutting interest rates from December.

Financial markets are tracking the development closely as investors assess the likely impact.