March Sees Only 98K New Jobs, But Jobless Rate Falls To 4.5 Percent

The economy added only 98,000 jobs in March, well below expectations, though the unemployment rate dropped to its lowest rate since May 2007, before the recession started.

The jobless rate last month fell from 4.7 percent to 4.5 percent because 472,000 more Americans found jobs last month, the Labor Department said Friday.

The year’s jobs growth had started strong — bolstered by warmer-than-normal weather — and an unexpectedly chilly March likely weighed on construction, which added only 6,000 jobs after growing by 59,000 in February.

“Job growth this year is running close to last year’s pace and is running well ahead of what is needed to keep up with labor force growth,” said Gus Faucher, chief economist at PNC Financial Services.

Jobs were revised down by 38,000 for January and February based on what was previously reported, but each month remained above 200,000.

But the last three months have averaged a solid 178,000 jobs each.

Economists had predicted that March jobs might slip after January and February posted robust gains.

Justin Wolfers, an economics professor at the University of Michigan, said: “You can stare at the labor market data all day, and you won’t be able to see an election effect. The economy is continuing, as before.”

Notably, the unemployment rate declined among less educated workers.

The unemployment rate for those with less than a high school diploma fell to 6.8 percent from 7.9. And the jobless rate for teenagers fell to 13.7 percent from 15 percent.

House Ways and Means Committee Chairman Kevin Brady (R-Texas) said that a key to strengthening the economy is tax reform, a forthcoming GOP legislative priority.

“It’s clear there is a lot of work to do to strengthen our economy, and it starts with overhauling our uncompetitive tax code,” Brady said.

Manufacturing added 11,000 jobs in March, continuing a four-month stretch of gains, though lower than the 26,000 from the previous month.

National Association of Manufacturers (NAM) President and CEO Jay Timmons said President Trump’s plan to slash regulations is bolstering confidence of the sector.

“The president is rethinking red tape and addressing our regulatory burden, helping us to create American jobs and grow our economy,” Timmons said.

“An outdated tax code, crumbling infrastructure and excessive regulations make it unnecessarily difficult to compete and win against overseas competitors,” he added.

Retailers, which have announced the closing of a slew of stores, took a hit in March.

Retail trade shed 30,000 jobs in March, while employment in general merchandise stores declined by 35,000 last month and have declined by 89,000 since a recent high in October.

Mark Hamrick, Bankrate.com’s senior economic analyst, said that the sector is being hurt by the announced closings.

“They’re struggling with overcapacity in the industry and the consumer’s shift to online purchases,” Hamrick said.

“We see that 30,000 retail jobs were lost in March and job cut announcements have been piling up since the beginning of the year, meaning more pain for retail workers looms in the months ahead,” he said.

Mining added 11,000 jobs in March and has risen by 35,000 since reaching a recent low in October.