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Employers Added a Modest 103000 Jobs in March

Employers Added a Modest 103000 Jobs in March

When the government issues its monthly jobs report Friday, those two questions will be the most closely watched barometers. With consumer confidence near the highest point in two decades, however, consumer spending is likely to rebound in the coming months.

With labor market slack diminishing, wage growth picked up a bit in March. The U.S. labor market is still very tight despite some bumpy economic news over the last month. Over the year, average hourly earnings have increased by 71 cents, or 2.7 percent.

"Considering how tight the labor market is in terms of the unemployment rate and [slow] population growth, it's hard to maintain 200,000 jobs being added every month", said Cathy Barrera, chief economist at ZipRecruiter. Still, the expansion has been puzzlingly slow, with economic growth averaging just 2.2 percent a year, about a percentage point below the historical average. The influx of new workers, which gives employers more hiring options than a 4.1 percent unemployment rate might otherwise suggest, may also be holding back wage growth.

The Fed increased borrowing costs last month and forecast two more interest rate hikes this year.

US stock index futures extended losses on the employment report.

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The dollar was little changed against a basket of currencies and prices for U.S. Treasuries rose. Economists did not see an impact on hiring in the near-term from a recent stock market selloff, which has caused a tightening in financial conditions.

Growth estimates for the first quarter are mostly below a 2 percent annualized rate. The economy grew at a 2.9 percent pace in the fourth quarter.

Analysts say the United States labor market will remain strong, supported by major tax cuts and fiscal spending, despite worries about a trade dispute with China. The unemployment rate had been expected to edge down to 4.0 percent. March's report is also a big slowdown from February and represented the fewest jobs created in six months.

Manufacturing employment increased 22,000. Temporary help, seen as a harbinger of future permanent hiring, slipped by 600.

With revisions for January and February that cut nonfarm payroll employment by 50,000 jobs, monthly employment gains have now averaged 202,000 over the past three months. Government payrolls rose by 1,000 in March.