While the April payrolls came almost precisely as expected, at 223K, a tiny 5K below the 228K expected, the reason stock are soaring is that the already abysmal March payroll prints was revised even lower to just 85,000, the weakest print since June 2012, and pushing the 3 month average job gain to under 200K, or a level which the Fed has indicated previously it will hardly do much if anything material.
The household survey did not provide an offsetting boost, with the number of employed Americans rising only 192,000 in April according to the "other" survey.
And, as a result and as we noted in our market wrap today, with a June hike now looking unlikely, the S&P has exploded higher.
In other relevant news, the unemployment rate is down from 5.5% to 5.4% as expected, but even more important, hopes that wages would finally rise are once again dashed with the average hourly earnings rising a paltry 0.1%, below the 0.2% expected and down from the pre-revision 0.3% gain in March, now revised to just 0.2%.
In other words, because ZIRP, QE has failed to trickle down for 7 years, the Fed has a greenlight to do more of it.
From the report:
Total nonfarm payroll employment rose by 223,000 in April, after edging up in March (+85,000). In April, employment increased in professional and business services, health care, and construction, while employment in mining continued to decline. (See table B-1.)
Professional and business services added 62,000 jobs in April. Over the prior 3 months, job gains averaged 35,000 per month. In April, services to buildings and dwellings added 16,000 jobs, following little change in March. Employment continued to trend up in April in computer systems design and related services (+9,000), in business support services (+7,000), and in management and technical consulting services (+6,000).
Health care employment increased by 45,000 in April. Job growth was distributed among the three major components--ambulatory health care services (+25,000), hospitals (+12,000), and nursing and residential care facilities (+8,000). Over the past year, health care has added 390,000 jobs.
Employment in construction rose by 45,000 in April, after changing little in March. Over the past 12 months, construction has added 280,000 jobs. In April, job growth was concentrated in specialty trade contractors (+41,000), with employment gains about evenly split between the residential and nonresidential components. Employment declined over the month in nonresidential building construction (-8,000).
In April, employment continued to trend up in transportation and warehousing (+15,000).
Employment in mining fell by 15,000 in April, with most of the job loss in support activities for mining (-10,000) and in oil and gas extraction (-3,000). Since the beginning of the year, employment in mining has declined by 49,000, with losses concentrated in support activities for mining.
Employment in other major industries, including manufacturing, wholesale trade, retail trade, information, financial activities, leisure and hospitality, and government, showed little change over the month.
And yes, according to the BLS, only 3,300 oil and gas extraction jobs were lost in April. According to Challenger, as noted previously, about 6 times that number. Someone is still lying.