Jobs Data Show Healthy Growth In the Economy --- Inflation Concerns May Rise As April Unemployment Dropped to 14-Year Low
WASHINGTON -- The April employment report, showing a drop in the jobless rate to a 14-year low and a modest rise in jobs, suggests healthy growth but is likely to add to fears of an overheating economy.</br></br>The rate fell to 5.4% of the civilian labor force, down from 5.6% in March and the lowest since June 1974, when it was also 5.4%. The last time the rate was lower was in May 1974, when it was 5.1%.</br></br>Non-farm business payrolls increased 174,000 after a revised 296,000 March job gain that was previously reported as 262,000. Manufacturing jobs registered strong growth.</br></br>As an indication of continuing economic strength, the drop is welcome news to Republican candidates in this election year. At the same time, it brings the rate further below a level that some economists consider "full employment," at a time financial markets are already worried about inflation and the possibility of credit-tightening by the Federal Reserve.</br></br>"It is a sign that we are bordering on an overheated situation in the labor market," said Roger Brinner, director of U.S. forecasting at Data Resources Inc. in Lexington, Mass. "This should add to nagging worries about whether inflation is going to rise."