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Weekly Economic Monitor -- The April Employment Report

By: Scott J. Brown, PH.D., Raymond James

The April Employment Report – Prior to seasonal adjustment, nonfarm payrolls rose by 1.089 million in the initial estimate for last month, about what we would see in a typical (pre-pandemic) April. The “problem” was that the seasonally adjusted gain was only 266,000 (+218,000 for the private sector). We shouldn’t make too much of one particular month of employment data. The three-month trend remained strong. However, there are going to be labor market challenges as we get back to normal and beyond.

This Week – The Consumer Price Index is expected to be up about 3.5% year-over-year, but that reflects a rebound from the low level of a year ago (+0.3% y/y in April 2020). Retail sales are expected to advance further (unit auto sales were reported higher). Industrial production may post a modest gain at best (in the April Employment Report, production hours were reported to have fallen 0.5%). Open your hymnals to page 238 – three members of the Fed’s Board of Governors will speak, all on the same subject (“U.S. Economic Outlook and Monetary Policy”).