WASHINGTON—U.S. companies added more jobs than expected in April, but the unemployment rate rose for the first time in five months and the economy’s recent slowdown is likely to keep a lid on gains.
Nonfarm payrolls rose by 244,000 last month as the private sector posted the strongest employment gain in five years, the Labor Department said Friday in its survey of employers. The March data were revised upward to show an increase of 221,000 jobs, from a previous estimated gain of 216,000.
However, the unemployment rate—which is obtained from a separate household survey—rose to 9.0% last month from 8.8% in March. It was the first increase in the jobless rate since November, when it hit 9.8%.
The mixed data weren’t what analysts expected. Economists surveyed by Dow Jones Newswires had forecast payrolls would rise by 185,000 and that the jobless rate would remain unchanged at 8.8%.
Even though the economy started growing almost two years ago, the pace has been too slow to make up for ground lost during the recession of 2008 and the first half of 2009. The economy has added some 1.5 million jobs over the past year, but there are still seven million fewer jobs than the U.S. had before the downturn. A slowdown in growth in the first quarter is expected to keep companies from ramping up hiring in future months.
Friday’s report showed private-sector employers, which account for about 70% of the work force, added 268,000 jobs in April, the biggest rise since February 2006. In March, employment in the private sector rose by 231,000.
The jobs breakdown from the employers survey showed continued gains in manufacturing, mining and the service sector. Manufacturing added 29,000 jobs after a gain of 22,000 in March. In the services sector, the biggest increases were in retail trade and professional and business services, as well as education and health. Employment in the battered construction sector posted another meager gain, and the housing sector remains a drag on the economy.
Government employment fell by 24,000, mainly because of declines in state and local governments, which are struggling to close their budget gaps.
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