By Geoffrey Partash
Unemployment rate down to 3.5% from 3.6%
The numbers: The US added a solid 236,000 new jobs in March, defying the Federal Reserve’s hopes of a significant slowdown in hiring as the central bank struggles to tame soaring inflation.
Economists polled by the Wall Street Journal had expected 238,000 new jobs.
While the increase in employment was the smallest in more than two years, the number of new jobs created last month was still stronger than is usually the case.
Meanwhile, the unemployment rate fell to 3.5% from 3.6%.
However, there was some good news in the Fed report.
Wage growth has continued to moderate near the level the Fed would prefer, for one thing.
Hourly wages rose by a modest 0.3% last month. The increase in wages over the past year slowed again to the lowest level in nearly two years at 4.2% from 4.6% in the previous month.
Moreover, the percentage of people who are working or looking for work, known as the labor force participation rate, has risen to 62.6%. This is the highest level since the last month before the pandemic in February 2020.
When more people are looking for work, companies don’t have to compete as much for workers with higher wages.
Stocks and bonds rose after the report.
On Friday, the government said the strong increase in employment last month followed a revised increase of 326,000 in February and 472,000 in January.
Combined, the United States added more than 1 million new jobs in the first three months of the year.
The big picture: The US economy is beginning to show further signs of deterioration.
Manufacturers have cut production, for example, and arguably are already in the doldrums. The much larger service side of the economy has been under more pressure lately.
The United States is still growing at the moment, however, and the job market remains an oasis of strength.
Low unemployment and high wages allowed Americans to keep spending. So far, they have steered the economy out of a widely expected recession.
Market reaction: Before the Dow Jones Industrial Average and S&P 500 were set to open lower in pre-market trade. The yield on the 10-year Treasury fell to 3.28%.
Jeffrey Bartash
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04-07-23 0855ET
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