U.S. added 431,000 jobs in March in sign of economic health

The U.S. job market continues to rebound with unexpected speed from the coronavirus recession, with 431,000 new positions added in March.

America’s employers extended a streak of robust hiring in March, adding 431,000 jobs in a sign of the economy’s resilience in the face of a still-destructive pandemic, Russia’s war against Ukraine and the highest inflation in 40 years.

The government’s report Friday showed that last month’s job growth helped shrink the unemployment rate to 3.6 per cent. That’s the lowest rate since the pandemic erupted two years ago and just above the half-century low of 3.5 per cent that was reached two years ago.

Despite the inflation surge, persistent supply bottlenecks, damage from COVID-19 and now a war in Europe, employers have added at least 400,000 jobs for 11 straight months. In its report Friday, the government also sharply revised up its estimate of hiring in January and February by a combined 95,000 jobs.

The March report sketched a bright picture of the job market, with steady hiring and rising wages in many industries. Average hourly pay has risen a strong 5.6 per cent over the past 12 months, welcome news for employees across the economy.

Still, those pay raises aren’t keeping up with the spike in inflation that has put the Federal Reserve on track to raise rates multiple times, perhaps aggressively, in the coming months. Those rate hikes will result in costlier loans for many consumers and businesses. In the meantime, worker pay raises, a response in many cases to labor shortages, are themselves feeding the economy’s inflation pressures.

Since the pandemic struck in 2020, many people have remained on the sidelines of the job market, a trend that has contributed to the worker shortage in many industries. But in an encouraging sign for the economy, 418,000 people began looking for a job in March, and many found one.

Over the past year, 3.8 million people have rejoined the labor force, meaning they now either have a job or are looking for one. The size of the labor force is now just 174,000 shy of its level in February 2020, just before the pandemic slammed into the economy.

The job growth in March, though solid, was the lowest since September. Jason Pride, chief investment officer of private wealth at Glenmede, said it reflected the job market’s durability in the midst of numerous obstacles.