US job numbers spur hopes of economic recovery

Employers in the United States added jobs at the fastest pace in four years last month, according to official data that fanned hopes America's economic recovery is gathering steam. Up by 290,000 jobs in April, non-farm payrolls beat analysts' forecast for a rise of 200,000 and the US labour department also revised up previous month's gains. Payrolls have now been rising for four months in a row although the unemployment rate has climbed to close to one in 10 people and the White House admitted it remained "painfully high". In April unemployment picked up to 9.9% from 9.7% in the first three months of this year. Much of the jump in payrolls was driven by private sector employers, which added 231,000 jobs, the biggest rise in four years. The improvement was broad-based with construction, manufacturing, professional and business services, education and health, and hospitality and leisure all adding jobs. The rise in manufacturing employment of 44,000 was the largest since August 1998. Economists said the private sector push underscored rising business confidence in the recovery. Still, the rise in the jobless rate will, on the surface, be a blow to President Barack Obama as he battles to cut stubbornly high unemployment and face off accusations of a jobless US recovery. Christina Romer, White House economic adviser, said the jobs report provided "the strongest signs yet of healing in the labour market" but conceded there was still a tough road ahead. "The rise in the unemployment rate reminds us of how far we still have to go before the economy is fully recovered," she said. "The unemployment rate is painfully high, and payroll employment is still nearly eight million below its level at the start of the recession. It will take many months of robust job growth to restore the labor market to genuine health." Economists echoed Romer's comments that the increase in the unemployment rate appeared to be largely down to more people becoming jobseekers as they reassessed their chances of finding work. "This suggests to us that people who have been disaffected and had given up looking for work are starting to become encouraged to look for a job again on the back of the better run the economy has had in recent months," said James Knightley, economist at ING Financial Markets. US government bond prices fell after the data as markets bet that it raised the chances of a rate hike from the Federal Reserve. US stock market futures had pointed to a rise after the jobs numbers but in the event opening bell was accompanied by more falls, adding to yesterday's drop on spreading financial crisis fears around Greece .