Kiplinger Jobs Outlook: Hints of Future Slowdown in Robust April Job Gains
Job growth was stronger than expected, but mounting economic uncertainty will reduce hiring going forward.

Kiplinger’s Economic Outlooks are written by the staff of our weekly Kiplinger Letter and are unavailable elsewhere. Click here for a free issue of The Kiplinger Letter or to subscribe for the latest trends and forecasts from our highly experienced Kiplinger Letter team.
Employment grew by a robust 177,000 jobs in April, following similarly strong growth in March. Health care, transportation and warehousing, food services, and state and local government contributed the most. Temporary jobs rose, for only the third time in the past 36 months. Strong recent hiring will support consumer disposable incomes for now.
But there are warning signs of a future hiring slowdown as new tariffs take effect: Jobs at auto manufacturers and dealers declined, and hours worked in manufacturing as a whole were down half a percent. Retail employment was flat. Transportation and warehousing jobs only grew to handle the last-minute flood of imports before the tariffs hit, and will likely be flat going forward. Federal government jobs dropped by 9,000 in April, and should continue to trend down. Food service hiring will likely be modest, as it tends to reflect the strength or weakness of the overall economy. Tighter immigration enforcement should also have an effect in this sector.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Expect consumer and business uncertainty to delay hiring plans. Hiring is often deferred when consumers are concerned about losing their jobs, or when businesses don’t know if there will be a positive return to investing in additional workers. Prior to the tariffs, we expected monthly job growth of about 150,000 new positions to continue. Now, that could fall to around 100,000, if enough employers decide to hold off on hiring while they sort out the effects of the new tariffs on both their businesses and the economy as a whole. And when hiring plans get put on hold, the unemployment rate tends to rise. We expect it to hit 4.5% by the end of the year, up from its current 4.2%.
The uncertainty and the looming economic slowdown will likely restrain pay gains. Annual wage growth slipped slightly, to 3.8% in April. This is likely to ease to 3.0% by December. The Federal Reserve would actually like to see annual wage gains come down, given that stronger wage growth makes it harder to bring overall inflation down to the Fed’s goal of 2%. Of course, if the Fed sees the unemployment rate on a steady upward trend, and a significant economic slowdown taking shape, it may cut interest rates regardless of what inflation is doing.
Consumer and business uncertainty is likely to upset hiring plans. Hiring is often delayed when consumers are concerned about losing their jobs, or when businesses don’t know if there will be a positive return to investing in additional workers. Prior to the recent drama over tariffs, we expected monthly job growth of about 150,000 new positions to continue. Now, that could fall to around 100,000, if enough employers decide to hold off on hiring while they sort out the effects of the new tariffs on both their businesses and the economy as a whole. And when hiring plans get put on hold, the unemployment rate tends to rise. We expect it to hit 4.5% by the end of the year, up from its current 4.2%.
The uncertainty and the possible economic slowdown will likely restrain pay gains. Annual wage growth slipped a bit, to 3.8% in March. The Federal Reserve would actually like to see annual wage gains come down to below 3.5%, given that stronger wage growth makes it harder to bring overall inflation down to the Fed’s goal of 2%. The Fed would also like monthly job gains to continue to average 150,000, a level that would suggest the labor market won’t overheat again. Of course, if the Fed sees the unemployment rate on a steady upward trend, and a significant economic slowdown taking shape, it may cut interest rates regardless of what inflation is doing.
Related Content
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

David is both staff economist and reporter for The Kiplinger Letter, overseeing Kiplinger forecasts for the U.S. and world economies. Previously, he was senior principal economist in the Center for Forecasting and Modeling at IHS/GlobalInsight, and an economist in the Chief Economist's Office of the U.S. Department of Commerce. David has co-written weekly reports on economic conditions since 1992, and has forecasted GDP and its components since 1995, beating the Blue Chip Indicators forecasts two-thirds of the time. David is a Certified Business Economist as recognized by the National Association for Business Economics. He has two master's degrees and is ABD in economics from the University of North Carolina at Chapel Hill.
-
New Hawaii 'Green Tax' Approved: Will Your Vacation Cost More?
State Tax Your trip to the Aloha State could be a bit more expensive next year. Here's why
-
How the One Big Beautiful Bill Act Could Reshape 529 Plans
Trump's budget-reconciliation package could change 529 plan rules as early as this summer. What does that mean for you?
-
How the One Big Beautiful Bill Act Could Reshape 529 Plans
Trump's budget-reconciliation package could change 529 plan rules as early as this summer. What does that mean for you?
-
Jet Set on a Budget: Expert Advice for Summer Travel
These cost-saving strategies, supplied by a financial adviser, are essential for enjoying summer travel without financial stress or debt.
-
5 Father's Day Gift Ideas That Also Make Good Long-Term Investments
Ties are tired. Try these growth-potential gifts instead.
-
My First $1 Million: Retirement Coach, 69, Sammamish, Wash.
Ever wonder how someone who's made a million dollars or more did it? Kiplinger's My First $1 Million series uncovers the answers.
-
CVS Is Closing More Stores in 2025: What It Means for You
As CVS Health continues its restructuring plan, additional store closures raise questions about access to pharmacy services and the future of retail healthcare.
-
The United and JetBlue Partnership: Everything We Know About Blue Sky So Far
Blue Sky, the United and JetBlue partnership just announced, will give frequent fliers more ways to earn and use miles. Here's what you need to know.
-
8 Changes to HSAs in the One Big Beautiful Bill Add up for Retirement Savers
HSAs are getting a glow-up in the pending tax bill. Those 55+ and workers enrolled in Medicare Part A will have more opportunity to save for medical costs in retirement.
-
Farewell to the Penny: US Treasury Ends Production of One Cent Coin
After more than 200 years, the U.S. bids adieu to the penny, citing high production costs and shifting economic practices.