The U.S. labor market bounced back in March, with job creation much stronger than expected though the broader picture of a slow-growth labor market held intact.
Nonfarm payrolls rose a seasonally adjusted 178,000 during the month, a reversal from the 133,000 decline in February and better than the Dow Jones consensus estimate for 59,000, the Bureau of Labor Statistics reported Friday. February’s number was revised down by 41,000 while January was revised up by 34,000 to 160,000, putting the three-month average around 68,000.
With job creation higher, the unemployment rate edged lower to 4.3%.
As has been the case, health care was responsible for much of the growth, with the sector adding 76,000. A strike at health-care provider Kaiser Permanente in February hit the sector. The BLS said ambulatory health care services rose by 54,000, with 35,000 coming from the strike workers returning.
Construction saw an increase of 26,000, while transportation and warehousing posted a gain of 21,000.
On the downside, the federal government saw a loss of 18,000, while financial activities lost 15,000.
Though the unemployment rate posted a decline, the move largely came from a decline of 396,000 in the labor force. The share of working-age Americans in the labor force fell to 61.9%, its lowest since November 2021.
The survey of households, which is used to compute the unemployment rate, showed 64,000 fewer people holding jobs. An alternative unemployment figure that counts discouraged workers and those holding part-time jobs for economic reasons edged up to 8%.
Wages also rose less than expected, with average hourly earnings up just 0.2% for the month and 3.5% from a year ago. Economists had expected respective readings of 0.3% and 3.7%. The annual increase was the lowest since May 2021.
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