Washington, D.C. (CNN) Last Monthly jobs report It showed that employment in the United States slowed in March but remained strong, with gains in companies providing services such as bars and restaurants, but weakness in construction and manufacturing.
Leisure and hospitality fueled last month’s growth in payrolls, a trend that has held steady since the economy began to recover from the pandemic. Government employers and the professional and business services industry also hired at a strong rate last month. But employment contracted in construction, manufacturing, and non-durable goods.
Here’s a look at where employment grew last month and where it contracted, according to the Bureau of Labor Statistics report.
Leisure and hospitality employers added 72,000 jobs last month, the most jobs of any industry. But the sector is still 2.2% below pre-pandemic employment levels and added fewer than average jobs in March compared to the previous six months.
“The gains we’re still seeing in healthcare, leisure and hospitality are because those industries are still trying to recoup earlier losses,” said Diane Swonk, chief economist at KPMG. “So, the services sector has held up but is showing some signs of cooling.”
Government employers added 47,000 jobs in March, led by hiring from state and local governments, which typically struggle to add workers. in a tight labor market. Healthcare companies added 34,000 jobs The business services sector — which includes many white-collar jobs such as accountants, engineers and consultants — grew by 39,000. Government jobs also remain 314,000, or roughly 1.4%, below the pre-pandemic level.
However, cracks are beginning to form in the commodity-producing portion of the labor market. The construction industry lost 9,000 jobs in March, the first decline in employment in the construction sector in over a year and the largest job loss in the sector since May 2024 – although it fell by just under 1.1%.
Home demand fell at the end of last year when the Federal Reserve raised interest rates Pay homebuyers’ borrowing costs. But while new residential construction slowed down over the past year, Construction jobs have been disrupted, Sonck said, mostly due to a backlog of construction projects. It added that the decline in employment in the construction sector in March was due to weak housing demand and “unusually harsh spring weather”.
Another casualty of the Fed’s rate hikes is manufacturing, which also lost jobs last month, according to the BLS.
“Manufacturing is one of the most interest rate sensitive industries, as is technology and financial services, so it’s not surprising that we’re seeing job losses there,” said Sinem Popper, chief economist at ZipRecruiter.
Data from the Institute for Supply Management released this week showed that the manufacturing sector contracted in March for the fifth consecutive month. The survey index fell to its lowest level since May 2020.
Popper added that the nondurable goods industry also experienced a decline in employment, which was likely due to weaker consumer demand for apparel and household products.
“These commodities are a little bit more responsive to any changes in the market, which is why we see the industry responding faster than durables,” Popper said.
Temporary jobs also fell by about 11,000 in March, which could be an indication that the labor market will contract further in the coming months, according to Beth Ann Bovino, chief US economist at S&P Global.
“If you start to see a decrease in temporary hires, it usually means that companies are seeing some softening in the revenue stream, which is one of the first signs of a downturn in the job market,” Bovino said.