Payrolls seen up in April, jobless rate steady

Economists polled by Reuters expect the government on Friday to say that U.S. employers added 200,000 jobs, topping March's gain of 162,000. Analysts predict hiring for the official 2010 population count could account for more than half of the expected gain.

Private-sector employment is expected to rise between 50,000 and 100,000 -- a welcome sign, but a step back from March when a rebound from bad weather helped lift private payrolls by 123,000.

However, the closely-watched employment report, which the Labor Department will release at 8:30 a.m. EDT (1230 GMT), is also expected to show the jobless rate holding at 9.7 percent for a fourth straight month in April.

Stubbornly high unemployment has been a political sore spot for President Barack Obama and his fellow Democrats, even though the job market appears to be slowly on the mend.

The trend is improving, said Zach Pandl, an economist at Nomura Securities International in New York. The economic recovery is gaining momentum.

Data ranging from manufacturing to consumer spending have pointed to a pick-up in the recovery from the U.S. economy's longest and deepest downturn since the Great Depression.

But public disenchantment over the economy, especially the labor market, is damaging Obama's popularity. His fellow Democrats face a tough fight in congressional elections in November, with their majority status at stake.

Republicans say Obama's policies -- including a record economic stimulus package -- have failed to deliver on their promise of reducing the jobless rate, which is expected to still be painfully high when elections rolls around.

CENSUS HIRING MAY SURPRISE

Analysts cautioned that overall April payrolls growth could fall short of expectations, citing previous census years when the government only ramped up hiring for the count in May.

The government surprised economists by recruiting just 48,000 census workers in March.

Historically in 1990 and 2000, May had been the month for hiring to complete the census and I do expect the big pop will be in May, not April, said Joseph Brusuelas, chief economist at Brusuelas Analytics in Stamford, Connecticut.

There was also a risk that layoffs at budget-stressed state and local governments could offset the temporary census gains.

Job growth is crucial to sustaining the recovery that first took root in the manufacturing sector, but which now appears to be broadening to consumers.

About 8.2 million jobs were lost during the recession and economists warn it is likely to take years to regain that lost employment.

Aside from hiring for the decennial census, payroll gains are expected in the manufacturing sector, which is benefiting from the restocking of warehouses by businesses to meet growing demand.

Construction employment, however, likely contracted last month after a weather-related bounceback in March.

Analysts will watch the average workweek to try to gauge whether earnings may be on the rise, which would help support spending.

Consumer spending, which normally accounts for 70 percent of U.S. economic activity, grew at a 3.6 percent pace in the first quarter, accounting for a large chunk of the 3.2 percent pace of growth during the quarter.

The average workweek is expected to have edged up to 34.1 hours in April from 34 hours in March.

The average workweek has increased enough in recent months to provide a significant lift to labor incomes, said Michael Feroli, an economist at JPMorgan in New York.

Analysts believe that businesses still skeptical of the durability of the economic recovery are trying to hold down new hiring by increasing hours for existing staff and putting temporary workers on the permanent payroll.