April’s employment report contained an even bigger surprise than the jump in U.S. payrolls: Spare capacity in the labor market is quickly disappearing, signaling that lackluster wage growth should get a spark in coming months.
The unemployment rate unexpectedly dropped to 4.4 percent, the lowest since May 2007, Labor Department data showed Friday. The underemployment rate, which includes discouraged workers and those who are working part-time but would prefer full-time positions, declined to the lowest since November 2007, one month before the last recession started.
