U.S. employment growth slowed in April

To fend off inflation, Federal Reserve Chairman Ben Bernanke and his colleagues are expected to bump up interest rates on May 10 by one-quarter percentage point to 5 percent. After that, some economists believe the Fed will take a break in its two-year rate-raising campaign. Others, however predict the Fed will push rates even higher.

On the payroll front, retailers cut just over 36,000 jobs in April, the most since September. Some economists said that the declines reflected a move by retailers to pare staffing after bulking up their employee ranks in March. Some said the drop was a byproduct of consolidation seen in retailing such as at department stores. Others suggested the decline was related toward the growth of self-service checkouts and the use of other technology at stores.

Information companies, including publishers, shed 2,000 jobs during the month.

But at other industries the hiring picture was much brighter. Manufacturers boosted payrolls by 19,000, the most in nearly two years. Leisure and hospitality companies added 20,000 jobs. Education and health services posted 35,000 job gains. Professional and business services added 28,000 positions. Financial firms increased employment by 26,000. Construction companies added 10,000 jobs.

The report comes as analysts expect the economy to log slower growth in the April-to-June quarter, predicting it will expand by about 3 percent. Such growth would mark a moderation from the brisk 4.8 percent pace registered in the January-to-March period but would still be considered healthy.

Just how much strength the second quarter shows will be affected by the appetite of businesses and consumers to spend and invest.

So far, they have been holding up under the strain of high energy prices.

Oil prices topped $75 a barrel, a record high in late April. Oil prices, which have been gyrating since then, were hovering below $70 a barrel on Thursday. Gasoline prices have marched higher and are above $3 a gallon in some areas.

Separately, consumer confidence sank to a seven-month low as sticker shock from rising gasoline prices made Americans anxious about the economy’s prospects and the strain on their own budgets.

The RBC CASH Index, based on results from the international polling firm Ipsos, showed confidence at 67.1 in early May. That marked a big deterioration from 89.4 in April.

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