The March jobs report showed that hiring slowed last month, but likely not enough to ease pressure on the Federal Reserve to raise interest rates in its efforts to slow inflation.
The US economy added 236,000 jobs in March while the unemployment rate fell to 3.5%, according to data from the US. The Bureau of Labor Statistics released on Friday showed.
Here are the key numbers from the report, compared to last month’s revised figures:
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Non-Farm Payroll: +236,000 vs. +326,000
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Unemployment rate: 3.5% vs. 3.6%
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Average hourly earnings, month over month: +0.3% vs +0.2%
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Average hourly wage, year over year: +4.2% vs +4.6%
In terms of industry, leisure and hospitality was once again the largest contributor to last month’s job gains with 72,000 new workers entering the sector during March. Temporary assistance services were the second largest contributor to job growth last month, with 65,000 workers joining the sector.
The labor force participation rate also picked up in March, rising to 62.6% from 62.5% in February. Average weekly working hours decreased slightly to 34.4 from 34.5.
Over the past six months, the US economy has added an average of 334,000 jobs per month.
After Friday’s release, markets now expect a 67% chance that the Fed will raise interest rates another 0.25% in May, up from the 50/50 odds Thursday before the numbers, According to data from the CME Group.
Forecasts released by the central bank last month indicated that an additional rate hike of 0.25% was likely this year.
However, economists see the March jobs data as the beginning of a period of slower growth for the US labor market that will eventually lead to higher unemployment.
“The 236,000 increase in non-farm payrolls in March adds to the evidence that the economy’s strong start to the year was in part an intermittent weather-related storm, with momentum now fading again,” Andrew Hunter, deputy chief US economist at Capital Economics, writes. In a note on Friday.
“With a sharp decline in job openings and an upward trend in jobless claims also indicating lower labor demand, and the drag from the recent banking turmoil continues to grow, we expect employment growth to slow more sharply soon.”
Fed expect Unemployment will rise to 4.5% by the end of this year.
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