April Nonfarm Payrolls Top Views; Fed Seen Holding Rates Again

11:04 AM EDT, 05/08/2026 (MT Newswires) -- The US economy added more jobs than projected in April, allaying concerns about a slowdown in the labor market and likely allowing the Federal Reserve to stick to its current policy stance.

Total nonfarm payrolls rose by 115,000 last month, the Bureau of Labor Statistics said Friday, well above the 65,000 increase expected in a Bloomberg-compiled survey. The increase in March was revised up by 7,000 to 185,000, while the fall in February was adjusted to 156,000 from 133,000, the BLS said.

"Payrolls were volatile through (the first quarter), largely due to temporary factors like inclement weather and a healthcare strike in California," Thomas Feltmate, senior economist at TD Economics, said in a report. "With those effects now in the rearview mirror, April provided as the first 'clean' read on hiring for 2026 and the underlying details were reasonably constructive, despite the recent surge in energy prices."

Energy prices have surged in the aftermath of the US-Israel war with Iran that has disrupted shipments through the Strait of Hormuz. A fragile ceasefire between Washington and Tehran appears to be holding, with the two sides said to be closing in on a peace deal.

Private payrolls growth slowed to 123,000 in April from 190,000 the month prior, the BLS reported. The Bloomberg consensus was for a 75,000 gain. The unemployment rate was unchanged at 4.3% in April, in line with Wall Street's estimates.

The pace of job growth appears to have improved since the end of last year, though "it's too soon to say whether the labor market is regaining momentum," Feltmate said.

"This morning's report alongside other recent data points including initial jobless claims and job posting data by Indeed certainly help to assuage any fears that conditions have continued to cool," he said.

The number of initial jobless claims came in below the Street's estimates on Thursday. Previously, ADP (ADP) said employment in the US private sector grew at its fastest pace in more than a year in April.

The Fed, which late last month kept its policy rate steady for a third consecutive meeting, is widely expected to stay put again next month, according to the CME FedWatch tool.

Following Friday's jobs report, Fed policymakers "can sit tight to better assess the extent to which higher energy prices bleed through to core measures of inflation in the months ahead," Feltmate said.

The April policy statement contained a bias toward future rate cuts, though three regional Fed chiefs opposed including such language.

"There is nothing in this (nonfarm payrolls) report to move the (Fed) off the sidelines on future rate cuts," Scott Anderson, chief US economist at BMO, said. "On balance, the solid jobs report makes the case for a near-term rate cut to stabilize a deteriorating labor market a more remote possibility."

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