Earlier this morning, the Labor Department released employment data for March. Most notably, the unemployment rate dropped to 8.2% from 8.3% the prior month; this was in line with economists’estimates.
In addition, the U.S. added fewer jobs than expected—120,000 compared with the 240,000 consensus estimate. The pocket of strength was manufacturing: Factories added 37,000 jobs in March. However, construction hiring declined 7,000 for the second month in a row. The silver lining is that the public sector is slowing down its layoffs—the government only cut 1,000 jobs in March.
This month’s data also showed modest gains in average hourly earnings, which rose $0.05. Finally, the average workweek, the first sign that employers could be boosting their payrolls, dipped slightly to 34.5 hours from 34.6 hours in February; this matched the consensus estimate.
I’m encouraged to see that the unemployment rate fell, but it would have been nice to see stronger payroll gains. For the past several months, the private sector has been driving job creation, and much of this is tied to how confident businesses are about the market. With this being the fourth year in the election cycle, I’m optimistic that the final two Presidential candidates will do all they can to assure business owners that they will shore up America’s fiscal house. As we approach November, we should see improvements in business sentiment, which should hopefully translate into labor market gains.