- U.S. Employers Added Fewer Jobs in March, Unemployment Rate Falls to 4.5%
Employers in the U.S. added fewer jobs in March than expected but the unemployment rate improved more than projected, creating an uncertain outlook of the U.S. labor market.
The U.S. payroll gained 98,000 jobs in March, this is 121,000 less than 219,000 jobs created in February and below 180,000 forecast by economists.
However, in a surprise twist the unemployment rate improved to 4.5 percent from 4.7 percent recorded in the previous month and beats economists consensus of 4.7 percent for this month.
While the number of jobs created is less than projected, it may also be indicating that the labor market is nearing what the Fed regards as full employment and likely to force employers to start raising wages to retain and attract desirable employees.
This is because on a critical look into the report, wages remain steady, rising 0.2 percent month-on-month. While in a slacked labor market, a drop from 219,000 jobs to 98,000 jobs should impact wages negatively. Also, the average workweek was unchanged at 34.3 hours in the same month.
“Market participants should look past” a disappointing March report,” Deutsche Bank analysts including chief U.S. economist Joe LaVorgna said in a note before the report. “A strong snapback in jobs and hours should be expected in the April data.”
This is the lowest unemployment rate since May 2007.