The Middletown Press (Middletown, CT)
Tepid job growth in healthy market
U.S. employers added a modest 103,000 jobs in March after several months of robust gains, though the government’s overall jobs report Friday suggested that the labor market remains fundamentally healthy.
The unemployment rate remained at 4.1 percent, a 17-year low, for a sixth straight month, the government said. Average hourly pay ticked up, climbing 2.7 percent compared with a year earlier.
The government also revised down its estimate of job growth for January and February by a combined 50,000. Still, over the past six months, employers have added a healthy average of 211,000 jobs, evidence that hiring in the United States remains strong and the economy on solid footing in its ninth year of recovery from the Great Recession.
The pullback in hiring last month was likely payback for an explosive gain in February, economists said. Employers added 326,000 jobs that month — the largest monthly haul in two years.
“Overall, looking through the volatility, employment growth is trending higher and wage growth is starting to heat up,” said Paul Ashworth, an economist at Capital Economics.
March’s tepid job gain may make it slightly more likely that the Federal Reserve will raise shortterm interest rates just twice more this year, rather than three more times. Last month, the Fed modestly raised its benchmark rate to a still-low range of 1.5 percent to 1.75 percent.
The Fed’s policymakers signaled at that meeting that a total of three rate increases were likely this year. But some economists have speculated that if further signs of rapid economic growth emerged, the Fed would raise rates faster to try to keep inflation under control.
Last month’s modest job gain may indicate that some employers want to hire more but are struggling to find the workers they need. A separate government report last month showed that there was nearly one open job for every unemployed person, the lowest ratio on records dating back two decades.
Edward Daniel, chief executive of Metropolitan Health Services, says he has raised pay and sweetened benefits to try to fill his 740-person company’s roughly 80 open jobs. Daniel’s firm, based in Herndon, Va., provides services to hospitals, such as valet parking and “sitters,” who stay with elderly or mentally ill patients after they’ve been sent home from operations.
“Across the board, hiring is a challenge,” Daniel said.
Some of the drop-off in hiring for March was likely weather-related, with late spring snowstorms blanketing the Northeast, closing construction sites and potentially postponing shopping trips for spring clothes. Construction companies cut 15,000 jobs, the sharpest monthly drop in three years, after five months of big gains. Retailers shed 4,400. Hotels and restaurants added just 4,300 workers, the fewest in six months.