Economy adds 165,000 jobs, unemployment falls to 7.5 percent

The economy added 165,000 jobs in April and the unemployment rate fell to 7.5 percent, the Bureau of Labor Statistics reported Friday. 

The monthly job numbers were better than expected, but the brightest spot of the report was in revisions for the previous two months. 

Employers added 114,000 more jobs than initially estimated — up to 332,000 from 268,000 in February and up to 138,000 from 88,000 in March. 

The revised figures should calm some concerns that the economic recovery is faltering even as worries remain about the effects of across-the-board spending cuts and tax hikes. 

Mark Zandi, chief economist for Moody’s Analytics, called the report a “relief and “a pleasant surprise” further saying, “I think job growth is slowing but not nearly as much as feared.”

Alan Krueger, chairman of the White House’s Council of Economic Advisers, said the report provides further evidence that the economy is continuing to recover.

“Now is not the time for Washington to impose self-inflicted wounds on the economy,” Krueger said.  

“The Administration continues to urge Congress to replace the sequester with balanced deficit reduction, while working to put in place measures to create middle-class jobs, such as by rebuilding our roads and bridges and promoting American manufacturing,” he said. 

Speaker John Boehner (R-Ohio) suggested the president work toward simplifying the tax code, reducing regulations, repealing the healthcare law and replacing the sequester with “smarter cuts.” 

“There’s some good news in today’s report, but the president’s policies still aren’t providing the robust economic growth and job creation the American people desperately need,” Boehner said. 

“To get things moving, we need to seize opportunities the president has been ignoring and focus on growing our economy rather than growing more government.”

The February revision up to 332,000 is the best showing since 521,000 jobs were added in May 2010. 

Before, without that month, the last time the economy added that many jobs was nearly eight years ago when 335,000 jobs were created in November 2005. 

The report shows that the construction sector shed 6,000 jobs because of a drop in nonresidential construction jobs, after growing for 10 consecutive months and adding 181,000 jobs during that time. 

Manufacturing job growth remained stagnant. 

“We’re falling further behind the pace needed to add 1 million manufacturing jobs in President Obama’s second term, yet no one in Washington seems very serious about a jobs agenda,” said Scott Paul, president of the Alliance for American Manufacturing (AAM).

“That must change.”

Another positive in the April report was that the drop in the jobless rate was because of stronger jobs growth, not because the unemployed stopped looking for work. 

An additional 210,000 people started looking for work in April, and many of them found jobs.

“I don’t think we should feel very comfortable about the state of the job market until unemployment is moving consistently south and the labor force is moving consistently north, and we’re not there yet,” Zandi said Friday on MSNBC.

He cautioned that the report does not change the fact that across-the-board spending cuts that went into effect on March 1 will slow growth in the coming months, especially during the July-September quarter. 

“I think the sequester is going to hurt. It is already hurting the job growth, and the numbers are beginning to weaken,” he said. 

“The script is still being written, and we have a long way to go.”

The unemployment rate has fallen from 7.9 percent since January and was down from 7.6 percent in March. 

The jobless rate is at the lowest level since President Obama took office in January 2009, when the rate was 7.9 percent. 

Another positive in the report was the decline in the number of long-term unemployed, which dropped by 258,000 to 4.4 million, or 37.4 percent of the unemployed. 

In the past 12 months, the number of long-term unemployed workers has decreased by 687,000.

Last month, the private sector added 176,000 jobs while the government shed 11,000 positions. 

Meanwhile, retailers added 29,000 jobs while the healthcare sector added 19,000.

The Federal Reserve is sticking with its plans to keep interest rates low until the labor market significantly improves and unemployment falls to 6.5 percent.

Updated at 9:47 a.m. and 10:04 a.m.