10:34 AM EDT, 05/02/2025 (MT Newswires) -- The US economy added more jobs than expected in April, while the unemployment rate remained unchanged, according to government data released Friday.

Total nonfarm payrolls rose by 177,000 last month, the Bureau of Labor Statistics reported. The consensus was for a 138,000 increase, according to a survey compiled by Bloomberg. Gains for March were revised down by 43,000 to 185,000 and lowered by 15,000 for February.

"Some of the underlying details of the April employment report were softer than the headlines, but overall, the data were strong enough to allow the Federal Reserve to remain on the sidelines as it monitors the impact of tariffs on inflation and inflation expectations," Oxford Economics Lead US Economist Nancy Vanden Houten said in remarks emailed to MT Newswires.

The unemployment rate was steady at 4.2% in April, in line with the market view.

"Based on our forecast for the economy to weaken substantially in response to higher tariffs, we expect the unemployment rate to approach 4.8% by the end of the year," Vanden Houten said.

Last month, US President Donald Trump announced sweeping new tariffs on imports, including from China, but later declared a 90-day pause on certain duties for non-retaliating countries. Washington and Beijing have been in a deadlock, but China said Friday it is evaluating approaches made by US officials to kick off negotiations on tariffs.

"Heightened trade uncertainty has already started to weigh on economic growth, and the impacts are likely to soon spillover to the labor market -- as evidenced by this week's jump in initial jobless claims," TD Economics Senior Economist Thomas Feltmate said in a separate note.

US government data on Thursday showed that weekly applications for unemployment insurance in the world's largest economy reached its highest level in about two months.

Private payrolls advanced by 167,000 in April, slowing down from a 170,000 gain the month prior, according to the BLS report released Friday. The consensus on Bloomberg was for an increase of 125,000. The service industry added 156,000 jobs, while employment for the goods-producing sector roe by 11,000, BLS data showed.

Average hourly earnings grew by 0.2% sequentially, below the Street's view for growth of 0.3%. The annual measure rose 3.8%, falling short of the 3.9% rise modeled by analysts.

"With price increases from tariffs in the pipeline and the unemployment rate expected to drift higher, the Fed could soon find itself in a tricky position," Feltmate said. "Provided inflation expectations remain well anchored, policymakers are likely to look through the inflation shock and deliver a few 'insurance cuts' this summer to better support the economy."

Markets are widely expecting the Fed to leave its benchmark lending rate unchanged next week, according to the CME FedWatch tool.