April adds 177,000 jobs to economy, tariff policies yet to majorly shakeup labor market: CEI analysis

The job numbers for April show 177,000 jobs were added to the economy, with the unemployment rate staying steady at 4.2 percent. While job growth is in a good spot currently, the effects of President Trump’s tariff policies have yet to majorly touch the U.S. labor market.

CEI Senior Economist Ryan Young:

“It was a rough week with both GDP shrinking and inflation still too high. While it’s good that April’s job growth was a stronger-than-expected 177,000, keep in mind that it works on a lag.

“Today’s numbers don’t yet account for Liberation Day tariff-related job losses, because many employers use bi-weekly or monthly payrolls. We’ll know more about those with next month’s numbers.

“This lag makes the Federal Reserve’s tough job even more difficult. If it lowers interest rates to stimulate a shrinking economy, it could further worsen inflation. A still-healthy labor market makes this less urgent, but it doesn’t know how healthy the job market still is, even with a fresh data release. This is one drawback to Trump’s rapid-fire policy changes.

“If the Fed raises interest rates to fight inflation, it risks further shrinking the economy and tipping over a potentially precarious labor market. It’s a no-win situation, and it will stay that way for as long as the new tariffs remain in effect.”

CEI Research Fellow Sean Higgins:

“The Labor Department’s report that Friday shows that Trump’s crusade to trim the federal government’s workforce has thus far netted 26,000 jobs. That number may seem small compared to the headlines caused by DOGE’s actions, but it is steadily growing and will continue to increase in the coming months. The department still counts as technically employed the thousands of people who are on paid leave or are receiving ongoing severance pay, but that will run out eventually.

“That’s out of a federal workforce estimated at 3 million people. Reducing that is a gargantuan task and the current administration has still only scratched the surface.

“Ironically, the resistance to efforts to trim the federal workforce has had the effect of making the overall jobs numbers look better for the current administration than they otherwise would.”