Unemployment Rate Forecast

Economic Forecasts

Job Market Turns Hot Again

Kiplinger’s latest forecast on jobs

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GDP 2.6% growth in '19 More »
Jobs Job gains near 180,000 per month in '19 More »
Interest rates 10-year T-notes at 2.8% by end ’19 More »
Inflation Up 2.2% in ’19 More »
Business spending Up 5% in ’19 as global growth slows More »
Energy Crude trading from $60 to $65 per barrel in August More »
Housing 5.35 million existing-home sales in ’19, up 0.2% More »
Retail sales Growing 3.7% in ’19 (excluding gas and autos) More »
Trade deficit Widening 7%-8% in ’19 More »

263,000 new jobs in April shows that the market run is not over. Hiring jumped in April from March’s 189,000 gain. Pickups were noted in construction, business services and temporary help. Strong growth continued in health care, social assistance and food services.

The one trouble spot is retail, which shed many workers for the third straight month. Department stores, warehouse clubs, superstores and haberdashers all showed weakness.

The labor market is still tight. Unemployment dropped to 3.6% in April, the lowest rate since 1969. The rate should bump back up to 3.7% in May but will go back down to 3.6% by year’s end. Hiring demand will likely outstrip new entrants to the labor force. The short-term unemployment rate (those unemployed for less than six months) is at its lowest level since the Korean War in 1953.

Nonsupervisory workers’ paychecks rose at an annual rate of 3.4% in April. The tight labor market is putting pay growth on an upward trend.

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A tightening labor market would normally invite interest-rate hikes from the Federal Reserve. But the Fed will hold off because of continued economic uncertainty and low inflation. The central bank has promised “patience,” which the market has taken to mean that it won’t do anything for a while.