US added 115,000 jobs in April, fueling cautious optimism about hiring

U.S. employers added 115,000 jobs in April, the Bureau of Labor Statistics estimated May 8, fueling some cautious optimism about hiring even as high oil prices tied to the Iran war and rising AI adoption pose risks to the labor market.

The April estimate comes in above forecasters’ expectations, but below the department’s now-revised estimated gain of 185,000 jobs added in March. Although U.S. employers shed an estimated 156,000 jobs in February, every other monthly report so far this year has indicated hiring is trending stronger in 2026 than it was last year, when employers added only about 15,000 jobs per month on average. By comparison, U.S. employers added more than 150,000 jobs per month on average in 2024.

Kory Kantenga, head of economics for the Americas at LinkedIn, said while the report was solid, the concerns he has about the labor market haven't gone away. With job growth still concentrated in health care and other gains coming from sectors that don't consistently add jobs, he wonders if the positive trend will last.

"We got a solid payroll number last month and we got a solid payroll number this month, but the question is, can this actually endure?" Kantenga said.

The unemployment rate remained at 4.3% in April. Officials and analysts see the unemployment rate as solid but say it does not tell the full story as immigration crackdowns and retirements from an aging workforce are limiting the supply of job seekers.

Still, positive job growth and a solid unemployment rate could prompt a Federal Reserve that has been concerned with slowing in the labor market to turn its attention back to inflation as an extended conflict in the Middle East pushes prices higher.

Which industries are hiring and where?

Health care, a steady engine of job growth given the country’s aging population, added 37,000roles in April. Employment in transportation and warehousing also rose by 30,000. Retail trade added 22,000, and the social assistance sector added 17,000. 

Federal government employment declined again, cutting 9,000 jobs. Since reaching a peak in October 2024, it is down 11.5%, the BLS said. The information sector also shed 13,000 roles. 

Employment in other industries, including construction, manufacturing, and professional and business services, was little changed in April, the BLS added.

While the overall unemployment rate remains stable, workers’ ability to land a job still depends on their industry, skills, and location. A BestBrokers report analyzing data from the U.S. Chamber of Commerce found several states, including California and Washington, have more workers than job openings, while other parts of the country, including North Dakota and South Dakota, are facing worker shortages. 

How is the job market overall?

After a year in which job growth stalled in the face of economic uncertainty, economists deemed the job market a “low-hire” and “low-fire" environment. Sam Taylor, a business expert at LLC.org, calls it the rise of the “frozen workforce.”

Under normal circumstances, businesses grow by hiring, and workers get ahead by switching roles. Right now, Taylor said, both sides are hesitating.

“Fewer job switches mean employees stay put for longer, even if they’re not the right fit,” Taylor said in a note to USA TODAY. “Fewer new roles limit entry points for younger or first-time workers. Less competition between employers reduces pressure to improve salaries or benefits.”

While April job gains surpassed expectations, participation and hiring patterns signal the labor market is "increasingly selective" according to Ger Doyle, a regional president at the employment agency ManpowerGroup.

"Employers currently hold more leverage in the labor market and are hiring with greater precision, concentrating demand in senior, specialized, and execution‑ready roles," Doyle said in a statement to USA TODAY. "Entry-level hiring has cooled and labor force participation remains subdued, which helps explain why the labor market can show steady demand while feeling harder to access.

Where is the job market headed?

Following a year shaped by economic uncertainty, changing trade policy, and relatively high interest rates, ZipRecruiter Economist Nicole Bachaud said businesses may be more inclined to hire now that they have a bit more clarity around tariffs, and because interest rates came down at the end of 2025.

The primary uncertainty today lies in potential impacts of the Iran war, she said.

“There are usually some delayed effects on certain industries depending on the length and the level of U.S. involvement in conflicts that could start to show up later on,” Bachaud said, adding the largest risk is if consumers pull back their spending on other goods and services to cover higher gas prices, which could lead to decreased hiring expectations.

A May 7 Challenger, Gray & Christmas report revealed private employers announced 83,387 job cuts in April, up from 60,620 in March, but down from 21% from April 2025. It found they announced plans to hire 10,049 workers in April, down 38% from 16,191 in March. So far this year, hiring plans are down 13% compared to the first four months of 2025.

Are wage gains keeping up with inflation?

Average hourly earnings for all employees on private, nonfarm payrolls rose by 0.2%, to $37.41in April, the BLS said. Over the last 12 months, they have increased 3.6%, outpacing the 3.3% year-over-year inflation recorded in March.

Inflation is expected to have risen in April, given surging oil prices stemming from the war and their potential impact on supply chains for other goods. The BLS’ Consumer Price Index report due out May 12 will confirm whether those predictions are correct.

While wage gains have kept up with inflation in aggregate over the last year, not every workers’ paycheck has kept up with prices. Wages for middle- and high-income workers have grown faster than for lower-paid workers, according to data compiled by the Federal Reserve Bank of Atlanta. 

What does this mean for the Fed?

Some Fed officials have characterized the federal funds rate — which stands at a range of 3.5% to 3.75% — as near neutral, meaning it is not stimulating nor restricting the U.S. economy. However, members of the rate-setting committee’s median expectation for the rate released March 18 implied one quarter-point cut will come before the end of the year.

Positive job growth and a stable unemployment rate paired with rising inflation could change that. Forecasters have begun pricing in a rate hike as a possibility later this year but still expect no movement at the Fed’s next meeting in mid-June.

If the Senate confirms President Donald Trump’s nominee Kevin Warsh, the June meeting will mark his first as chair. Despite Trump’s demands for lower rates, Warsh wouldn't be the only voice when it comes to the Fed's key rate. Even if he believes lower rates are the best path for monetary policy, he would need to persuade a majority of the rate-setting committee to vote with him.

(This story was updated to add new information.)

Reach Rachel Barber at [email protected], follow her on X @rachelbarber_, and subscribe to her newsletter "Making More of Your Money" here.