US firms add 204,000 jobs in April

U.S. businesses added 204,000 jobs in April as the labor market maintains steady growth and shows no signs of slowing down. 

Hiring was strong across a broad range of sectors as monthly jobs growth eclipsed 200,000 for the sixth straight month, payroll processor ADP said on Wednesday. 

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Mark Zandi, chief economist at Moody’s Analytics, which oversees the ADP report, said U.S. companies are “aggressively” hiring despite increasing headwinds. 

“Despite rising trade tensions, more volatile financial markets and poor weather, businesses are adding a robust more than 200,000 jobs per month,” Zandi said.

“At this pace, unemployment will soon be in the threes, which is rarified and risky territory, as the economy threatens to overheat,” he said. 

Zandi warned that an economy with an unemployment rate in the 3 percent range — which is being bolstered by the deficit spending of the Republican tax bill this time around — have historically overheated.

“The next recession is starting to come into view,” he said.

The economy has seen 3 percent unemployment in the 1990s and briefly in the 1960s and 1950s, which were all followed by downturns, Zandi said. 

In April, professional and business services added 58,000 jobs, education and health services hired 39,000 and restaurants and hotels added 36,000 jobs. 

Construction added 27,000 jobs, manufacturing added 10,000 and mining tacked on 7,000 jobs last month. 

Medium-sized companies with 50–499 employees led the way last month, adding 88,000 jobs.

The government will release its jobs numbers on Friday with estimates around 190,000.

In March, the economy added 103,000 jobs, well below estimates, while the unemployment rate stayed at 4.1 percent, a 17-year low. 

At 106 months, the economy is on its second-longest streak of growth, and Zandi said he expects that by June 2019 there is a good chance the U.S. economy will reach a record.

Steady economic growth is pushing up prices and will likely convince the Federal Reserve to stand pat on interest rates at their meeting, which ends on Wednesday.