Labor market & economy
Consumer prices rose 3.8% year over year in April, the highest rate since May 2023 and up from 3.3% in March, driven largely by a surge in energy costs tied to the Iran war, according to Bureau of Labor Statistics data.
Energy prices drove most of the increase:
Gasoline prices rose 28.4% annually; energy overall was up 17.9% year over year.
Food prices climbed 0.5% for the month and 3.2% annually, with food at home posting its biggest monthly gain since August 2022.
Shelter costs rose 0.6% after easing in prior months; apparel increased 0.6% and airline fares rose 2.8% for the month, putting the 12-month gain at 20.7%.
Workers came out behind:
Real average hourly wages slipped 0.5% for the month and fell 0.3% annually, the first time in three years that inflation has outstripped year-over-year wage growth.
Average hourly earnings rose 3.6% year over year, below the 3.8% inflation rate.
Rate cuts are off the table for now:
Core CPI, which strips out food and energy, rose 0.4% for the month and 2.8% annually, above forecasts and well above the Fed's 2% target.
Traders raised the odds of a Fed rate hike by year end to about 30%, according to CME Group data.
Inflation is the key drag on the U.S. economy now. This is hurting Americans. There is a real financial squeeze underway. For the first time in three years, inflation is eating up all wage gains."
Read more via CNBC, The Wall Street Journal
The Conference Board's Employment Trends Index (ETI) increased in April, with seven of its eight components contributing positively.
The ETI rose to 105.77 in April, up from a downwardly revised 105.52 in March.
The share of consumers reporting jobs are "hard to get" fell 1.5 percentage points to 19.8%, the lowest level since the start of the year.
The share of small firms reporting positions "not able to be filled right now" rose from 32% to 34%, its highest level since June 2025.
Initial claims for unemployment insurance fell to 203,300 in April, near a historic low.
This month's increase in the ETI was broad-based with positive contributions from 7 of its 8 components, which underscored the labor market's continued resilience. However, challenges to the outlook include potential economic disruptions from geopolitical tensions as well as AI-driven layoff announcements."
Employment in temporary help services rose for the fourth consecutive month.
The only negative signal came from the share of involuntary part-time workers, which rose to 17.9%, slightly above the 2025 average of 17.5%.
Read more via The Conference Board
Employers awarded a mean merit increase of 3.1% this year, just below the 3.2% projected in October 2025, with average total increases of 3.4% against a predicted 3.5%, according to Mercer's QuickPulse Compensation Planning Survey of 756 employers.
Only 4% of employers gave across-the-board "peanut butter" raises, with most still tying increases to individual performance and market positioning.
Variation by sector was minimal on merit increases, with no industry averaging above 3.2%; high tech led on total increases at 3.6%, while chemicals and other manufacturing came in at the low end at 2.9%.
A separate Payscale survey found 16% of companies are ready to implement across-the-board raises and another 18% are considering it, suggesting the practice may grow even if it hasn't gone mainstream yet.
Read more via HR Dive
The overall unemployment rate for veterans increased from 3.0% to 3.5% in 2025, still below the 4.2% rate for nonveterans, according to the Bureau of Labor Statistics annual Employment Situation of Veterans report.
The unemployment rate for male veterans (3.3%) remained below their nonveteran counterparts (4.3%); the rate for female veterans (4.6%) rose more sharply, up 1.1 percentage points over the year.
Female veterans ages 25 to 34 had an unemployment rate of 8.1%, almost double the 4.2% rate for nonveteran women in the same age group.
Veterans with a service-connected disability saw their unemployment rate fall 1.7 percentage points to 2.4%; 34% of all veterans, or 5.8 million people, reported a service-connected disability.
Gulf War-era II veterans, the largest veteran group at 5.6 million, were nearly three times as likely to work in the public sector as their nonveteran counterparts — worth watching as federal workforce cuts continue.
Read more via Bureau of Labor Statistics
Nearly all net job growth over the past year has come from healthcare and social assistance, a sector where women outnumber men three to one, while sectors with heavily male workforces have been losing ground, according to a Wall Street Journal analysis of Bureau of Labor Statistics data.
Healthcare and social assistance added 656,500 jobs over the year ended in April; without those gains, the private sector would have shed 145,500 jobs.
Since the end of 2024, the number of jobs held by women has increased by 421,000; the number held by men has slipped by 1,000.
Manufacturing and transportation and warehousing, both male-dominated sectors, have shed jobs over the past year, with tariffs and the Iran war among the contributing factors.
Men are clearly being affected by the tariffs and poor performance of manufacturing."
Among men age 25 to 54, the employment-to-population ratio was 86.5% in April, roughly where it was in 2019; for women in the same age group, it was 75%, above the 2019 average of 73.7%.
A widening education gap is making things worse: 46% of women age 25 to 54 hold a bachelor's degree versus 38% of men, and that gap is projected to keep growing.
Read more via The Wall Street Journal
Retail added nearly 22,000 jobs in April, accounting for almost one-fifth of total job growth, and retailers posted their highest volume of monthly job openings since 2023 in March, with openings spiking 48% from a year earlier.
Warehouse clubs and supercenters drove much of the sector's April hiring; department stores and electronics and appliance sellers saw payrolls shrink.
Retail's hiring surge reflects growing employer confidence that consumers will keep spending despite inflation and the Iran war, a reversal from 2025 when many companies held back amid tariff uncertainty.
Consumer sentiment hit another record low in May, according to the University of Michigan, hurt by rising gas prices tied to the war.
Whirlpool cited a "recession-level industry decline" and McDonald's CEO told analysts that consumer spending "may be getting a little bit worse."
Read more via CNBC
An analysis of ADP payroll data covering more than 400,000 U.S. workers in their 20s found Birmingham, Ala., and Tampa, Fla., at the top of the list, with six of the top 10 markets located in the South.
Birmingham led the rankings with one of the strongest hiring rates for degree-level jobs among 20-somethings and a strong affordability score; median annual wages for recent graduates there rose more than 16% to $59,004.
Tampa had the strongest outright hiring rate, driven by healthcare, financial services, and technology employers, with average rent prices easing 4% year over year after a pandemic-era surge.
San Jose ranked third, one of the bigger surprises given its cost of living, lifted by a modest rebound in junior tech hiring likely tied to AI investment.
Columbus, Ohio, was the Midwest standout, with strong hiring in advanced manufacturing and financial services; Anduril Industries is adding more than 4,000 jobs near the city, including entry-level roles.
The analysis measured 53 major metro areas, weighing hiring rates for degree-level jobs against affordability-adjusted pay.
Total layoffs in the first four months of 2026 reached 300,749, down 50% from the same period last year when federal worker cuts dominated, and private-sector layoffs were 10% lower than a year ago, according to Challenger, Gray & Christmas. AI-driven cuts are accelerating in the technology sector.
Tech companies have cut more than 85,000 employees so far this year, a 33% increase over the same period in 2025.
Major recent announcements include PayPal cutting 20% of its workforce over two to three years, Meta cutting 8,000 employees, Oracle facing an estimated 30,000 cuts, and Amazon eliminating 30,000 corporate positions since late 2025.
AI was cited explicitly in cuts at Coinbase, Block, Snap, Atlassian, Dow, and Pinterest, among others; Estee Lauder, Disney, and Morgan Stanley cited shifting business strategies.
The cuts span industries well beyond tech, including retail, consumer goods, financial services, and logistics.
Two major employers announced significant white-collar job cuts this week, with Walmart trimming about 1,000 corporate workers and General Motors cutting 500 to 600 salaried IT employees.
Walmart's cuts stem from a consolidation of global-technology and product teams, with many affected workers asked to relocate to its Bentonville, Ark., or Northern California offices rather than simply being let go. A company spokeswoman said the changes are about organizational structure, not AI.
GM's IT reductions are part of an effort to bring in staff with different skill sets, as the automaker works to expand its software and AI capabilities.
Both companies are managing broader cost pressures, including the economic impact of the Iran war.
Read more via The Wall Street Journal, Bloomberg
Littler's 14th Annual Employer Survey, drawn from more than 300 U.S.-based C-suite executives, in-house lawyers, and HR professionals, finds AI has overtaken immigration and DEI as the leading area where employers expect policy and regulatory impacts over the next 12 months.
84% of respondents expect business impacts from AI-related policy or regulatory changes in the next year, double the share that said the same in 2025.
By contrast, immigration fell to 49% from 75%, and DEI dropped to 38% from 84%, though the firm noted employers appear to be adjusting to a "new normal" rather than indicating those issues have gone away.
37% say their organizations have reassessed or are reassessing job responsibilities because of AI; 20% report reducing or planning to reduce hiring.
68% now report having a formal AI policy in the workplace, up from 38% in 2025, but only about half have a formal review process for AI tools or restrictions on what information can be entered into them.
79% are concerned about AI-related litigation over the next 12 months, with data privacy, discrimination or bias, and compliance with state AI laws as the leading areas of concern.
67% reported an increase in mental health-related leaves of absence and accommodation requests over the past year, and the number keeps going up.
Read more via Littler
The Trump administration proposed a rule that would create a new category of "limited excepted benefits," allowing employers to offer IVF and other fertility treatments directly to employees, exempt from some requirements of the Affordable Care Act and other federal health coverage laws.
To qualify, benefits must be focused on diagnosing or treating infertility or related reproductive health conditions, with a combined lifetime cap of $120,000 per participant, adjusted for inflation starting in 2028.
The proposal builds on Trump's February 2025 executive order on IVF access and is intended in part to address declining U.S. birth rates; CDC data cited in the rule show U.S. births fell 9% between 2014 and 2024.
Fertility benefits adoption remains relatively low; a 2024 survey by the International Foundation of Employee Benefits Plans found 42% of employers offered some form of fertility benefits.
The American Society for Reproductive Medicine noted in a 2025 analysis that existing coverage pathways are voluntary and leave open questions about access for lower-income workers and people who have historically had less access to care.
A 60-day public comment period will begin after the rule is published in the Federal Register.
Read more via U.S. Department of Labor, HR Dive
Twenty-four Americans across six states are being monitored for hantavirus following an outbreak aboard an expedition cruise ship in Argentina, where the disease has killed three people and infected at least eight. Health authorities say the risk to the broader public is low, but the situation raises real questions about what employers are supposed to do when a slow-incubating infectious disease starts turning up in the workforce.
The Andes strain of hantavirus, unlike domestic variants, can spread between humans, though experts say it requires prolonged close physical contact with a symptomatic person and is not airborne.
The CDC estimates roughly 38% of patients who develop serious respiratory symptoms will die; there is no vaccine and no specific antiviral treatment, and the incubation period runs from four to 42 days.
Under OSHA's General Duty Clause, employers must act on recognized hazards; workers in agriculture, construction, warehousing, pest control, and rural property management are most at risk.
Employers with workers traveling to South America for fieldwork or research should make sure those employees have current CDC precautionary guidance.
The outbreak is also a reminder of a structural problem: with no federal paid sick leave mandate, workers who can't afford to lose income tend to show up sick. It has happened in every major outbreak in recent memory.
Read more via HCA Magazine
France: France wants Switzerland to start paying unemployment benefits for workers who commute across the border and lose their jobs, instead of leaving France with the bill. France currently pays €860 million a year to former “frontier workers” who lost jobs in Switzerland but live in French border regions. Switzerland, which is outside the EU, would need to agree to any change under its bilateral Free Movement Agreement, and its State Secretariat for Economic Affairs estimates the reform could cost the country CHF 600 to 900 million a year. (VisaHQ)
Germany: One year into Friedrich Merz's chancellorship, the German business community has moved from optimism to frustration. Bankruptcies are at their highest level since the financial crisis, the economy is stagnating, and the Federation of German Industries says Germany's position as a center of industry is "under existential threat." Business groups say promised structural reforms have not materialized. (Deutsche Welle)
Japan: Japan's economy is projected to have grown at an annualized pace of 1.8% in the first quarter of 2026, marking the second consecutive quarter of expansion, according to average estimates from ten private think tanks. The impact of the Iran war is expected to be more significant in the second quarter. (Nippon.com)
Norway: Norway's central bank raised interest rates by 25 basis points to 4.25%, becoming the first major central bank to do so since the Iran war reignited inflation fears globally. Governor Ida Wolden Bache said inflation has been running above target for several years and that the war in the Middle East continues to create "substantial uncertainty about the economic outlook." (CNBC)
