A stronger-than-expected April jobs report gave investors a second straight upside surprise, a welcome development after an uneven stretch for the labor market. Payrolls rose while the unemployment rate held steady at 4.3%, although average hourly earnings were a bit light, writes Bret Kenwell, US investment analyst at eToro US.
That wage softness doesn’t arrive at a great time for consumers, especially with energy prices rising across the US. Meanwhile, more than half of April’s job gains came from trade, transportation, and utilities. When combined with education and health services, those two categories accounted for nearly all of the month’s gains — a reminder that the headline number was encouraging, but not necessarily broad-based.
Source: Trading Economics
This is not a robust jobs environment. But there has been some relief in the last two months of gains — the first back-to-back job gains in nearly a year. That’s particularly true after February’s 156,000-job loss and after the labor market averaged a monthly loss of 7,600 jobs in the second half of 2025.
Strength in the labor market helps support a healthy consumer, and consumer spending remains the backbone of the US economy. But investors hoping for rate cuts may need to stay patient. Rising energy prices are adding to inflation concerns, and if the labor market and broader economy continue to hold up, the Fed’s motivation to lower rates keeps dwindling — even with a new Chair coming in.
In other words, good news may actually be good news again — just not for investors hoping the Fed rides in with quick rate cuts.
