US employers add solid 223K jobs; rate falls to 5.4 percent, 7-year low

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WASHINGTON (AP) -- U.S. employers added 223,000 jobs in April, a solid gain that suggests that the economy may be recovering after stumbling at the start of the year.

The job growth helped lower the unemployment rate to 5.4 percent from 5.5 percent in March, the Labor Department said Friday. That is the lowest rate since May 2008, six months into the Great Recession.

The level of hiring signaled that companies were confident enough in their outlook last month to fill positions. The job growth, if sustained, could fuel an economic rebound after a January-March quarter in which the U.S. economy is thought to have shrunk.

"Today's report argues that the economy is in decent health," says Scott Clemons, chief investment strategist at Brown Brothers Harriman Private Banking.



U.S. stock prices rose sharply when trading began an hour after the jobs report was released at 8:30 a.m. Eastern time.

Still, Friday's figures included signs of concern: A weak March job gain was revised sharply down to just 85,000 from 126,000. In the past three months, employers have added 191,000 positions, a decent gain but well below last year's average of 260,000.

And the job growth isn't raising worker pay much. Average hourly wages rose just 3 cents in April to $24.87. Wages have risen 2.2 percent over the past 12 months, roughly the same sluggish pace of the past six years.

Clemons said he was surprised by the meager gain in earnings.

"Everything in this cycle has been slow-motion," he said, referring to the modest recovery from the 2007-2009 Great Recession. "Maybe wages are another example of that."

Tara Sinclair, a professor at George Washington University and chief economist at the job listings service Indeed, said: "We're definitely back to that same discussion we were having before March and earlier this year: Things are looking pretty good and going in the right direction, but where is the wage growth?"

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US employers add solid 223K jobs; rate falls to 5.4 percent, 7-year low
A job seeker fills out an application during a National Career Fairs job fair Wednesday, April 22, 2015, in Chicago. Weekly applications for jobless aid ticked up 1,000 to a seasonally adjusted 295,000, the Labor Department said Thursday, April 23, 2015. The four-week average, a less volatile measure, increased to 284,500. Still, that is just 2,000 higher than three weeks ago when the average was at a nearly 15-year low.(AP Photo/M. Spencer Green)
In this April 22, 2015 photo, Ralph Logan, general manager of Microtrain, left, shakes hands with a job seeker during a National Career Fairs job fair in Chicago. The U.S. Labor Department reports on the number of people who applied for unemployment benefits last week on Thursday, May 28, 2015. (AP Photo/M. Spencer Green)
Graphic shows the national unemployment rate and monthly job gains.; 2c x 4 inches; 96.3 mm x 101 mm;
Job seekers wait to be interviewed during a Virgin Hotels job fair in Chicago, Illinois, U.S., on Wednesday, Nov. 5, 2014. The U.S. Department of Labor is scheduled to release initial jobless claims figures on Nov. 5. Photographer: Daniel Acker/Bloomberg via Getty Images
A representative of Virgin Hotels talks to job seekers about what type of job they're pursuing before being interviewed during a Virgin Hotels job fair in Chicago, Illinois, U.S., on Wednesday, Nov. 5, 2014. The U.S. Department of Labor is scheduled to release initial jobless claims figures on Nov. 5. Photographer: Daniel Acker/Bloomberg via Getty Images
Job seekers wait to be interviewed during a Virgin Hotels job fair in Chicago, Illinois, U.S., on Wednesday, Nov. 5, 2014. The U.S. Department of Labor is scheduled to release initial jobless claims figures on Nov. 5. Photographer: Daniel Acker/Bloomberg via Getty Images
A job seeker waits to be interviewed during a Virgin Hotels job fair in Chicago, Illinois, U.S., on Wednesday, Nov. 5, 2014. The U.S. Department of Labor is scheduled to release initial jobless claims figures on Nov. 5. Photographer: Daniel Acker/Bloomberg via Getty Images
NEW YORK, NY - SEPTEMBER 17: People attend a jobs fair at the Bronx Public Library on September 17, 2014 in the Bronx Borough of New York City. According to the U.S. Bureau of Labor Statistics, the national unemployment rate fell to 6.2% as of June, 2014, though the Bronx borough is still suffering through 10.8% unemployment. (Photo by Andrew Burton/Getty Images)
A vendor waits to set up his roadside stall in New York on October, 13, 2014. New claims for US unemployment insurance benefits fell last week to their lowest level in more than eight years, the Labor Department said. AFP PHOTO/Jewel Samad (Photo credit should read JEWEL SAMAD/AFP/Getty Images)
Job seekers fill out applications during the Eagle Ford Shale Job Fair at the American Bank Center in Corpus Christi, Texas, U.S., on Wednesday, Oct. 29, 2014. The U.S. Department of Labor is scheduled to release initial jobless claims on Oct. 30. Photographer: Eddie Seal/Bloomberg via Getty Images
NEW YORK, NY - SEPTEMBER 17: People attend a jobs fair at the Bronx Public Library on September 17, 2014 in the Bronx Borough of New York City. According to the U.S. Bureau of Labor Statistics, the national unemployment rate fell to 6.2% as of June, 2014, though the Bronx borough is still suffering through 10.8% unemployment. (Photo by Andrew Burton/Getty Images)
A job seeker arrives to speak with recruiters at the Career Choice Inland Empire Career Fair in Ontario, California, U.S., on Wednesday, Sept. 10, 2014. The U.S. Department of Labor is scheduled to release intial jobless claims figures on Sept. 11, 2014. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
NEW YORK, NY - SEPTEMBER 17: People wait in line outside to attend a jobs fair at the Bronx Public Library on September 17, 2014 in the Bronx Borough of New York City. According to the U.S. Bureau of Labor Statistics, the national unemployment rate fell to 6.2% as of June, 2014, though the Bronx borough is still suffering through 10.8% unemployment. (Photo by Andrew Burton/Getty Images)
Job seekers wait in line to speak with recruiters at the Career Choice Inland Empire Career Fair in Ontario, California, U.S., on Wednesday, Sept. 10, 2014. The U.S. Department of Labor is scheduled to release intial jobless claims figures on Sept. 11, 2014. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
Kim Thy of the New York City Police Department (NYPD), right, speaks with job seeker Eric Swasey of Manhattan at Choice Career Fairs' New York career fair at the Holiday Inn Midtown in New York, U.S., on Tuesday, May 13, 2014. The U.S. Department of Labor is scheduled to release initial and continuing jobless claims data on May 15. Photographer: Craig Warga/Bloomberg via Getty Images
Ryan Cronauer, center, hands his resume to Tracy Malechek, left, a sous chef at Gramercy Tavern, at a career fair held by Union Square Hospitality Group at the Jazz Standard in New York, U.S., on Saturday, July 19, 2014. The U.S. Department of Labor is scheduled to release initial jobless claims figures on July 24. Photographer: Michael Nagle/Bloomberg via Getty Images
Job seekers line up outside at Choice Career Fairs' New York career fair at the Holiday Inn Midtown in New York, U.S., on Tuesday, May 13, 2014. The U.S. Department of Labor is scheduled to release initial and continuing jobless claims data on May 15. Photographer: Craig Warga/Bloomberg via Getty Images
A man pushes a shopping cart across a street in El Monte, California on June 19, 2014, beneath a banner announcing a free job fair. New US claims for unemployment insurance benefits fell last week, continuing to point to a downward trend in job losses, official data released today showed. The US Labor Department said initial jobless claims fell by 6,000 to 312,000 in the week ending June 14, following three straight weeks of gains. AFP PHOTO/Frederic J. BROWN (Photo credit should read FREDERIC J. BROWN/AFP/Getty Images)
Applicants listen to an introductory presentation during a SkyWest Airlines Inc. flight attendant recruitment event in Chicago, Illinois, U.S., on Tuesday, Feb. 18, 2014. The U.S. Department of Labor is scheduled to release initial jobless claims figures on Feb. 20. Photographer: Daniel Acker/Bloomberg via Getty Images
Job seekers line up for the Recruit Military veteran job fair in San Diego, California, U.S., on Thursday, Feb. 27, 2014. More Americans than forecast filed applications for unemployment benefits last week, a sign the labor market is improving in fits and starts. Photographer: Sam Hodgson/Bloomberg via Getty Images
Job seekers wait to talk to recruiters and fill out applications at a job fair in New York, U.S., on Thursday, Jan. 16, 2014. Jobless claims decreased by 2,000 to 326,000 in the week ended Jan. 11, the least since the end of November, from a revised 328,000 in the prior period, a Labor Department report showed today in Washington. Photograph: Victor J. Blue/Bloomberg via Getty Images
Job seekers wait to talk to recruiters and fill out applications at a job fair in New York, U.S., on Thursday, Jan. 16, 2014. Jobless claims decreased by 2,000 to 326,000 in the week ended Jan. 11, the least since the end of November, from a revised 328,000 in the prior period, a Labor Department report showed today in Washington. Photograph: Victor J. Blue/Bloomberg via Getty Images
The minimum requirements for aide and caregiver employment are listed on a poster during the Fall Classic Hiring Spree event at Los Angeles City College in Los Angeles, U.S., on Thursday, Oct. 10, 2013. Economists and policy-makers have been trying to understand the reason for the prolonged period of high unemployment in the U.S.: a skills mismatch, weak aggregate demand, or wage rigidities. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
Job seekers meet recruiters for New York Life Insurance Co. during an employment fair hosted by Premium Job Fairs in New York, U.S., on Tuesday, Sept. 10, 2013. The U.S. Department of Labor is scheduled to release initial jobless claims on Sept. 12. Photographer: Ron Antonelli/Bloomberg via Getty Images
Job seeker Miguel Latorre reviews his resume and paperwork during a job fair in New York, U.S., on Thursday, Aug. 22, 2013. The fewest workers in more than five years applied for U.S. unemployment benefits over the past month, indicating the labor market continues to improve. Photographer: Craig Warga/Bloomberg via Getty Images
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The Federal Reserve has been monitoring the job market for convincing evidence of a healthier economy. The chronically sluggish pay growth and the downward revision to March's job gain may dissuade the Fed from raising interest rates from record lows anytime soon.

The "Fed could be on hold forever with anemic numbers like these," said Tom di Galoma, head of fixed income trading for ED&F Man Capital Markets.

Other economists suggested that the Fed isn't likely to raise its key benchmark rate until late this year or perhaps not until next year.

Some trends that held back growth earlier this year remained evident in Friday's jobs report. The mining industry, which includes oil and gas, cut 15,000 jobs, its fourth straight loss. Oil drilling has fallen sharply after last year's plunge in oil prices.

Manufacturers added only 1,000 jobs after a flat reading in March. That's down from the industry's average monthly job gain of 18,000 last year. A strengthened dollar, which makes U.S. exports costlier overseas, is slowing factory output.

Construction companies, though, picked up much of the slack by adding 45,000 jobs, the most in 16 months. And he health care industry gained 56,000 jobs.

Such solid figures add to other evidence that the economy may be gradually picking up. Home sales staged a big comeback in March, a sign more Americans are making expensive purchases. People bought existing homes at an annual pace of 5.19 million, the National Association of Realtors said.

Those gains are expected to extend into April based on figures on signed contracts released by the Realtors. That would help spur additional growth in the construction sector as builders seek to meet demand.

Some Americans also appear to be gradually stepping up their spending. Service firms such as restaurants, retailers and banks grew at a faster pace in April than in March, according to a survey by the Institute for Supply Management, a trade group of purchasing managers.

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AP Economics Writers Josh Boak and Paul Wiseman contributed to this report.

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