Anabelle Colaco
09 May 2026, 20:27 GMT+10
WASHINGTON, D.C.: U.S. employers added a stronger-than-expected 115,000 jobs in April, defying concerns that surging energy prices and global economic disruption caused by the Iran war would sharply weaken the labor market.
The Labor Department said Friday that hiring slowed from March's revised 185,000 jobs but still comfortably beat economists' forecasts of about 65,000 new positions. The unemployment rate held steady at 4.3%.
The figures suggest the U.S. job market has so far remained resilient despite turmoil in global energy markets following disruptions to oil supplies through the Strait of Hormuz.
"The labor market is not booming, but it is proving harder to break than many feared,'' said Olu Sonola, head of U.S. economic research at Fitch Ratings.
Healthcare companies led hiring in April, adding 37,000 jobs, while transportation and warehousing firms added 30,000 positions.
Manufacturing, however, continued to struggle. Factories cut 2,000 jobs last month and have shed 66,000 positions over the past year despite President Donald Trump's protectionist trade policies aimed at boosting domestic industry.
"Businesses to some extent are viewing the conflict in Iran as temporary,'' said Gus Faucher, chief economist at the financial firm PNC. "We continue to see solid growth in consumer spending. And we're seeing strong business investment, particularly around tech and AI. The economy continues to expand. We've weathered some shocks. The worst of the tariff impact is likely over.''
Still, Faucher warned that prolonged conflict and persistently high energy prices could weigh more heavily on growth.
"The longer conflict in Iran lasts, the higher energy prices go, the longer they stay elevated the greater the drag on the economy,'' he said.
The Iran war has triggered one of the biggest disruptions to global oil supplies in history after Iran shut down the Strait of Hormuz following attacks launched by the U.S. and Israel on Feb. 28. Gasoline prices in the United States have climbed above $4.50 a gallon in recent days.
Despite those pressures, wage growth remained relatively stable. Average hourly earnings rose 0.2% from March and 3.6% from a year earlier, a pace broadly consistent with the Federal Reserve's inflation target.
At the same time, the labor force continued to shrink. The labor force participation rate fell to 61.8%, the lowest level since October 2021, as fewer Americans either worked or looked for work.
Economists say an aging population and tighter immigration policies have reduced the number of workers entering the labor market, meaning the economy no longer needs to generate as many jobs each month to keep unemployment steady.
Matthew Martin, senior U.S. economist at Oxford Economics, said the monthly number of jobs needed to stabilise unemployment is now close to zero.
The report also pointed to signs of broader improvement after a weak 2025, when employers added an average of just 9,700 jobs a month.
Retailers added 22,000 jobs in April, while construction firms added 9,000. "America's hiring recession appears to be over,'' said Heather Long, chief economist at Navy Federal Credit Union.
"The bad news is inflation is eating up wage gains again. Wages grew at 3.6%. That certainly won't be enough at a time when inflation is expected to hit 4%. Americans still have jobs, but they are financially squeezed by surging gas prices and transportation costs."
The stronger-than-expected hiring figures are also likely to reinforce expectations that the Federal Reserve will keep interest rates unchanged as it monitors inflation pressures linked to rising energy costs.
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