March’s job report is the first one in twelve months to come in below expectations, indicating that the labor market is experiencing a cool down. The number of new Nonfarm payrolls came in at 236,000 for the month of March. Unemployment dipped slightly to 5.8 million, falling to 3.5% from the month of February. Transportation and Warehouse changed little, with couriers and air transportation picking up 13,000, but warehousing losing 12,000. As the Federal Reserve continues to try and balance inflationary trends with increases to the interest rates, the labor market is still causing concerns that a recession could possibly occur.
January's Job Opening and Turnover Survey
At the end of January, job openings decreased to 9.9 million, and hires marginally decreased to 6.2 million, from 6.4 million in January. The quit rate rose minimally to 4 million, and layoffs and discharges decreased to 1.5 million.
Several sectors saw a decrease in job openings. The largest decreases in job openings were in Professional and Business Services (with 278,000 jobs lost), Healthcare and Social Assistance (150,000 jobs lost), and Transportation and Warehousing and Utilities (145,000 jobs lost). Meanwhile, in January, Construction saw an increase of 129,000 job openings, and Arts, Entertainment, and Recreation saw an increase of 38,000 new jobs.
While there was a small increase in the number of quits (4 million) and a small decrease in layoffs/discharges (1.5 million), the numbers for February prepare us for what we see in the March report.
February's Jobs Report
Non-farm payroll grew by 236,000 in March, and, after the 311,000 new jobs seen in February, this is a clear indication that the labor market is cooling down. Unemployment slid down slightly to 3.5%, as the labor force participation rate increased slightly to 62.6%.
Transportation and Warehousing jobs changed little but did increase by 10,000 jobs. Leisure and Hospitality managed to add 72,000 in March but is lower than the 95,000 jobs they have been gaining monthly since September of last year. There were other gains in Professional and Business Services (+39,000). Professional, Scientific, and Technical Services (+26,000), Government (+47,000), and Healthcare (+34,000), also saw gains in March. Meanwhile, the Retail industry saw little change in the number of jobs last month.
The March Jobs Report and the February Job Opening and Turnover Survey reveal that the labor market is still in charge of the economy, but things are starting to calm down. The Federal Reserve will probably still raise interest rates to make this process continue, but the raise looks like it will be a quarter point. There will be another report before the next Reserve meeting in May.
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Meaghan Goldberg covers recruitment and digital marketing for Lionzone. A Patterson, GA native, after graduating from both Valdosta State University and Middle Tennessee State University, Meaghan joined Lionzone in 2018 as a digital recruitment strategist before becoming the social media manager.