Jobless rate dips to 3.6% as U.S. employers added 431,000 jobs in March
Despite snarled supply chains and a war in Europe, the U.S. job market powered on in March, with robust hiring pulling the unemployment rate close to its pre-pandemic level.
Payrolls grew by 431,000 last month, driven by increased hiring in leisure and hospitality as well as professional and business services, the Labor Department reported Friday.
Hiring was also strong in education and social assistance, retail sales and manufacturing.
Unemployment falls as more workers find jobs
The unemployment rate fell to 3.6%, from 3.8% the previous month. The rate fell for most demographic groups, but ticked up slightly for White men and Latino men.
A broader measure that includes discouraged workers and those working part-time for economic reasons also fell sharply. That rate, "which also includes discouraged workers and those working part time who want full-time [work], fell by 3 tenths [month over month] to just 6.9%. That is just one tenth away from matching the lowest level since 1994 when they started to calculate this component," Peter Boockvar, chief investment officer at Bleakley Advisory Group, said in a report.
A decline in COVID-19 infections around the country is leading more Americans to seek work and also cutting down on absenteeism on the job. In March, people reported that they had been unable to work because their employer closed or lost business because of the pandemic, down from 4.2 million in February. And fewer Americans are working remotely, with 10% of U.S. employees teleworking last month, down from 13% in February.
"There was a concern early in the recovery that workers would have difficulty actually returning to work; that's something we saw after the Great Recession, where the jobs recovery was very slow," said Daniel Zhao, senior economist at the job site Glassdoor. "The surprise with this expansion is the labor market has been stronger than expected, and workers have had an opportunity to return quickly."
While the number of jobs added lagged economists' expectations of about 550,000 new additions, figures for January and February were revised to show about 95,000 more jobs created than initially estimated. With the latest report, the economy is within 1.5 million jobs of its pre-pandemic level. The participation rate for prime-age workers rose to 80, just 0.5 below its pre-pandemic level.
"Today's report is very healthy," said Zhao. "Part of the reason it looks like such a dramatic deceleration is that last month's [job] growth was revised up to 750,000 the fastest growth we've been seeing since September 2020."
Wages grow, but lag inflation
Wage growth accelerated slightly last month, with average hourly pay growing 5.6% over the last 12 months. Worker pay has been increasing at the fastest pace in decades, but those gains have lagged behind inflation for nearly a year. Consumer prices this year have risen 8%, the sharpest rate of increase since the early 1980s.
Pay grew most for leisure and hospitality workers, who enjoyed an average wage hike of 11% from the year before.
With the Federal Reserve raising interest rates to try to control inflation, and ongoing supply-chain disruptions from Russia's war in Ukraine, it's likely that job gains will cool in coming months. Still, the hiring market remains robust, with 11 million job openings in February, nearly double the amount of unemployed workers.
"There are reasons to believe that we won't see blockbuster job gains, but we still should be able to see healthy job growth," Zhao said.
With reporting by CBS News' Alain Sherter and the Associated Press.
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