The U.S. economy added a stronger-than-expected 244,000 jobs in April, the Labor Department said Friday, as employers continued the solid pace of job creation seen in the prior two months.
The number of jobs created last month was well above the 185,000 new jobs that analysts had predicted, the government reported. Private employers added 268,000 jobs — the most since February 2006.
April marked the third straight month in which more than 200,000 jobs were created, the best three month hiring spree in five years. Job gains in March and February were even stronger than first reported.
The job gains were widespread. Retailers, factories, financial companies, education and health care and even construction companies all added new workers. Federal, state and local governments cut jobs.
The data suggest businesses are confident in the economy despite weak growth earlier this year. Payrolls growth increased sharply in February and March, marking the fastest two-month pace of job creation since before the recession began and heralding a decisive shift in the labor market.
“The trend now is definitely up,” former Federal Reserve governor Larry Meyer told CNBC Friday. “The economy is regaining momentum and we are on the path for above-trend growth. This [number] is much stronger than expected.”
However, the jobs report showed the nation’s unemployment rate rose to 9 percent in April from a two-year low of 8.8 percent seen in the prior month. The increase was the first since November, but was due in part to the fact that more Americans have resumed looking for work.
Reacting to Friday’s jobs numbers, Austan Goolsbee, the chairman of the White House Council of Economic Advisers, told CNBC he expected the nation’s unemployment rate to fall if job creation continues at its current pace.
Speaking to workers at a plant in Indianapolis Friday that will make hybrid auto transmissions, President Barack Obama hailed another month of job growth, calling the U.S. economy resilient.
The positive jobs report completes a strong week for Obama, who announced earlier in the week that a team of Navy SEALs killed Osama bin Laden, the mastermind behind the Sept. 11, 2001 terrorist attacks.
A string of downbeat economic data this week — including a sharp slowdown in the vast services sector, a decrease in hiring by private companies in April and an eight-month high for jobless aid applications — had some worried that April’s jobs report could be weaker than expected.
With gas prices spiking, consumers are spending more to fill the tanks, leaving them with less to spend elsewhere. As a result, consumer spending has weakened and many companies are feeling less certain about the economy's health.
But most analysts agree the economy has strengthened enough to keep growing this year. And many say the factors that held back growth at the start of the year were most likely temporary. They predict growth will pick up over the rest of the year.
There have been some positive signs. Retailers reported strong April sales, helped by a late Easter. Auto companies reported brisk sales. And factories have expanded production this year at the fastest pace in a quarter-century.
Economists' prediction for a pickup in overall growth is based, however, on gasoline prices stabilizing in the months ahead and then dropping to around $3.50 a gallon (3.79 liter) or lower near the end of the year.
Gas prices had risen for 44 straight days before holding steady Friday at a national average of roughly $3.99 a gallon.
"The U.S. labor market strengthened in April, damping concerns that rising energy costs are staunching the recovery, said Sal Guatieri, an economist at BMO Capital Markets Economics.