Jobs data for April comes in strong, reducing the likelihood of a rate cut

The housing industry has watched employment numbers closely, as many expect that the Federal Reserve is waiting to see the jobs market crack before cutting interest rates that have stymied the housing market since the summer of 2022.

The strong numbers will likely keep mortgage rates high for now. The wild card is President Donald Trump’s trade war, which has raised fears of rising unemployment and even a recession. The trade war’s impact has not yet circulated through the economy, so any effects on employment have yet to land.

“There are so many crosscurrents in the current economy, making it hard to predict how employers would respond,” Bright MLS chief economist Lisa Sturtevant said in a statement. “It is possible we will see more of a pullback in hiring in May and June. In addition, some businesses may have ramped up hiring in April in expectation of future impacts of tariffs.”

The report has different implications for specific job sectors. Federal government employment declined by 9,000 positions during the month, showing that Trump‘s and Elon Musk’s attacks on the federal workforce are having an impact.

Employment in the transportation and warehousing sector increased by 29,000. Employment in construction also increased, and about 10,000 new jobs were created in the real estate sector as a result of rental and leasing activity. The manufacturing sector — which Trump said would boom due to tariffs — remained flat.

The implications of the jobs report on the housing market are primarily related to mortgage rates, and the likelihood that they stay high is a negative compounded by other factors.

Consumer confidence has taken an epic dive, falling by 32% since January, which is taking a toll on demand for housing. According to a survey from Redfin, 24% of respondents are canceling plans to make large purchases like homes, while another 32% are pausing their searches.