United States Economy Added 236,000 Jobs in March 2023
Another monthly jobs report shows that, while the United States economy is beginning to cool, unemployment continues to reach near-record lows.
According to the latest Bureau of Labor Statistics report, the U.S. added 236,000 jobs in March 2023, with unemployment ticking down to 3.5% from 3.6%. This is only slightly off the 238,000 jobs that economists forecasted. Additionally, February’s figure was revised upward by 15,000 to reach a new total of 326,000 for the month. This means that, for the first quarter of the year, the economy has added more than a million jobs to payrolls.
Of the newly-added jobs, the Leisure and Hospitality sector accounted for 72,000 positions during the month. That’s down from the 95,000 average the sector has seen over the past six months. Drilling down further, jobs in food services increased by 50,000 in March. Elsewhere, government employment grew by 47,000 to match the six-month average while the Professional and Business Services vertical added 39,000 jobs, outpacing the average of 34,000 observed in the past half of a year. On the other end, retail trade payrolls fell by 15,000 during the month, while building material, garden equipment, and supplies dealers saw a monthly decline of 9,000 jobs.
As for what this month’s report — including the revisions to previous numbers — could spell for the future, Moody’s Analytics director Dante DeAntonio stated (via CNN Business), “The new revised path of [jobless] claims more closely aligns with an increase of job cut announcements in recent months and also with the slowdown in payroll growth.” DeAntonio added, “[Unemployment insurance] claims data will continue to provide an early signal into whether the labor market is likely to cool further in the coming months.”
Another big question surrounding the report is whether or not the lower results are enough for the Federal Reserve to pause its rate hikes campaign. While the Fed has backed off its more aggressive interest rate increases, it did still move them up a quarter-point last month in a bid to fight continued inflation. On that front, Sal Guatieri of PNC Financial Services told MarketWatch, “Although job growth is gradually slowing, it remains too strong for the Federal Reserve.”
On the one hand, the fact that the U.S. economy continues to add jobs and unemployment remains low is good news for everyday Americans. Unfortunately, the strength of the report does make it more likely that the Federal Reserve will inch up interest rates once again, which hurts borrowers — including those with credit card debt, consumers seeking new mortgages, and others. Looking ahead, we’ll need to wait and see whether April’s figures bear out the current downward trend or whether another “strong” report will cause more headaches for the Fed.