The numbers: The U.S. created just 266,000 new jobs in April even as the economy gained strength, suggesting companies might be struggling to fill open jobs even with millions of people still unemployed.
The increase in new jobs fell well short of Wall Street’s forecast. Economists surveyed by Dow Jones and The Wall Street Journal had forecast 1 million new jobs.
The disappointing employment report shaved stock gains on Friday in premarket trades.
The official unemployment rate, meanwhile, rose to 6.1% from 6%, the U.S. Labor Department said Friday. Yet the first increase in 13 months stemmed from more people entering the labor force in search of jobs — a good sign for the economy.
The small increase in new jobs belies mounting evidence that companies are eager to hire more workers in response to soaring demand for goods and services. Job openings have surged, for instance, and a survey of small businesses showed that 60% tried to hire people in April.
The momentum in the economy is unlikely to fade anytime soon, either. Rising vaccinations and falling coronavirus cases have allowed states to lift business rules and encouraged Americans to resume normal activities. They are going out to eat, traveling or taking their first vacation in more than a year.
At the same time, the government is pumping trillions of dollars of stimulus into the economy in a bid to restore growth as quickly as possible.
Big picture: The shortfall in new jobs in April is likely just a temporary blip. Falling coronavirus cases and massive federal stimulus have turbocharged the economy and job openings have surged. The U.S. is still set up for a summer of strong growth, especially if the virus is mostly squelched.
The economy is still missing more than 8 million jobs that existed before the crisis, however, not to mention the 2 million jobs that would likely have been created had the pandemic never happened at all. It will probably take a year or two to get them all back.