U.S. private employers hired the fewest workers in two years in April amid chronic labor shortages and rising costs, which are hitting small businesses the hardest, raising the possibility that overall job growth slowed considerably last month, Reuters reported. That was reinforced by a separate survey from the Institute for Supply Management (ISM) on Wednesday showing a measure of services sector employment contracted in April for the second time this year. Services businesses in the ISM survey described demand for workers as remaining "hypercompetitive," noting that "there is just not enough qualified personnel available." Government data on Tuesday showed there were a record 11.5 million job openings on the last day of March, which pushed up the jobs-workers gap to a record 3.4% of the labor force from 3.1% in February. "The softer trend is consistent with a slowing in job growth that we expect to start in April," said Veronica Clark, an economist at Citigroup in New York. "Softer monthly job gains would likely be due to labor shortages." Private payrolls rose by 247,000 jobs last month, the smallest gain since April 2020, after increasing 479,000 in March. The slowdown in hiring was across the board, with leisure and hospitality industry payrolls rising by 77,000 jobs, the fewest since late 2020. Manufacturing employment increased by 25,000 jobs, while construction added 16,000 positions.
