Some Employers Add Workers: What We Learned During the Week of May 4 – 8

The unemployment rate dipped in April. Here are five things we learned from U.S. economic data released during the week ending May 8. 

Payrolls expanded in April. Nonfarm payrolls grew by a seasonally adjusted 115,000, following March’s 185,000 gain and February’s 156,000 contraction. The Bureau of Labor Statistics finds that private-sector employers added 123,000 jobs, with much of that gain coming from health care/social assistance (+53,900), transportation/warehousing (+30,300), and retail (+21,800). Government payrolls shrank by 9,000. Average weekly earnings of $1,283.16 were up 3.6 percent from a year earlier.

Based on a separate household survey, the unemployment rate declined by 0.2 percentage points to 4.2 percent. The labor force contracted by 92,000, pushing the labor force participation rate down 0.1 percentage points to 61.8 percent. The 25-54 labor force participation rate held steady at 83.8 percent. The typical length of unemployment fell by half a week to 11.0 weeks, while the count of part-time workers “for economic reasons” jumped by 445,000 to 4.942 million. The broadest measure of labor underutilization—the U-6 series—increased by 0.2 percentage points to 8.2 percent.

Hiring picked up, leaving fewer unfilled jobs in March. The Bureau of Labor Statistics estimates the number of job openings declined by 56,000 to a seasonally adjusted 6.866 million. Job openings were down 1.2 percent from a year earlier. Private-sector employers had 6.143 million unfilled jobs, including at least a million opportunities in health care/social assistance, trade/transportation/utilities, and professional/business services. Employers hired 5.378 million workers, an increase of 655,000 for the month and 4.1 percent from a year earlier. Hiring exceeded a million workers in health care/social assistance, trade/transportation/utilities, leisure/hospitality, and professional/business services. 5.378 million people separated from their jobs, up 356,000 for the month and 1.7 percent from a year earlier. This included a 125,000 rise in the number of people who quit their jobs (3.171 million) and a 153,000 jump in layoffs (1.867 million).

The trade deficit swelled in March. Exports increased 2.0 percent to a seasonally adjusted $320.9 billion, and imports grew 2.3 percent to $381.2 billion. The resulting deficit of -$60.3 billion represented a 4.4 percent increase in the Census Bureau and Bureau of Economic Analysis measure. The year-to-date trade deficit of -$172.8 billion was down 55.0 percent from the same three months a year ago and 13.5 percent from its 2024 comparable. In March, the goods deficit grew by $4.1 billion to -$88.7 billion, while the services surplus increased by $1.6 billion to +$28.4 billion. The former reflected increased exports of industrial supplies/materials (including crude oil) and food, and growth in imports of automobiles, consumer goods, capital goods, and industrial supplies/materials. The U.S. had its largest goods deficits with Taiwan, Vietnam, Mexico, and China.

The service sector expanded again in April. The Services PMI slipped 0.4 points to 53.6. Despite the decline, the Institute for Supply Management measure has remained above 50.0 (the threshold between an expanding and contracting service sector) for 22 consecutive months. Indices for business activity/productivity (55.8) and employment (48.0) rose, while those for new orders (53.5) and inventories (53.1) declined, including a large decrease for the former. Fourteen service sector industries reported growth, including wholesale trade, management of companies/support services, and mining. Contracting industries were agriculture, real estate, and retail.

Consumer sentiment slipped a bit more in early May. The preliminary May 2026 reading of the University of Michigan Index on Consumer Sentiment was 48.2 (seasonally adjusted, 1966Q1=100), down 1.6 points for the month and 7.7 percent from a year earlier. The decline leaves the index at its historic low. The current conditions index fell 4.7 points to 47.8 (-18.8 percent versus May 2025), while the expectations measure edged up 0.4 points to 48.5 (+1.3 percent versus May 2025). The press release noted that one in three survey respondents “spontaneously” mentioned gas prices in their comments, while 30 percent of consumers had tariffs on their minds. 

Other U.S. economic data released over the past week:

• Jobless Claims (Week ending May 2, 2026, First-Time Claims, seasonally adjusted): 200,000 (+10,000 vs. the previous week, -28,000 vs. the same week a year earlier). 4-week moving average: 203,250 (-10.5% vs. the same week a year earlier).
• Vehicle Sales (April 2026, Auto and Light Truck Sales, seasonally adjusted): 15.920 million (-1.5% vs. March 2026; -7.1% vs. April 2025.
• Factory Orders (March 2026, New Orders for Manufactured Goods, seasonally adjusted): $630.4 billion (+1.5% vs. February 2026; +3.7% vs. March 2025).
• Productivity (2026Q1-preliminary, Nonfarm Labor Productivity, seasonally adjusted annualized rate): +0.8% vs. 2025Q4; +2.9% vs. 2025Q1.
• Wholesale Trade (March 2026, Merchant Wholesalers Inventories, seasonally adjusted): $932.8 billion (+1.3% vs. February 2026; +2.9% vs. March 2025).
• Consumer Credit (March 2026, Outstanding Non-Real Estate Consumer Credit Balances, seasonally adjusted): $5.141 trillion (+$24.8 billion vs. February 2026; +2.3% vs. March 2025).
• State Employment (March 2026, Nonfarm Payrolls, seasonally adjusted): Increased in 3 states and unchanged in 47 states and the District of Columbia vs. February 2026. Increased in 3 states, decreased in 3 states and the District of Columbia, and unchanged in 44 states vs. March 2025.
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