The March Jobs Report: What is the Current US Employment Situation?

The US Bureau of Labor Statistics (BLS) released their monthly overview of the US employment situation and the data for March looks discouraging due to the impact of the coronavirus and the efforts to contain it. The labor department jobs report examines a range of US jobs data to gauge the overall health of the US economy, specifically the number of jobs added, the unemployment rate, and what industries are hiring now.

Last Month’s Numbers

Before we get to the March jobs report, let’s revisit February’s US job numbers. Last month, the BLS reported that nonfarm payroll employment increased by 273,000 jobs. The unemployment changed little at 3.5% (approximately 5.8 million professionals). A deeper look at the US jobs data and industries hiring in 2020 showed promising growth in a few areas while others registered little change.

• Health care and social assistance – 57,000 jobs added
• Food services and drinking places – 53,000 jobs added
• Government employment – 45,000 jobs added
• Construction – 42,000 jobs added
• Professional and technical services – 32,000 jobs added
• Financial activities – 26,000 jobs added
• Manufacturing, mining, wholesale trade, retail trade, transportation and warehousing, and information – no change

This Month’s Numbers

Due to the spread of the coronavirus, we saw drastic changes to employment numbers in March. However, the numbers in the March jobs report only show the early impacts of the virus, since they represent activity in the first half of the month. This predates many coronavirus-related business closures and other notable job activity that occurred in the second half of the month. We’ll see this activity and its impact on employment numbers reflected in the April jobs report.

The March jobs report showed total nonfarm payroll employment dropped by 701,000, unemployment increased by 0.9% to 4.4%, and the number of unemployed persons rose by 1.4 million to 7.1 million.

Here are some other highlights of the labor department jobs report:

• The number of unemployed people on temporary layoff more than doubled to 1.8 million.
• The number of unemployed people who were jobless less than 5 weeks jumped from 1.5 million in March to 3.5 million. Meanwhile, the number of long-term unemployed people was relatively unchanged (1.2 million) and accounted for 15.9% of the unemployed.
• The labor force participation rate fell by 0.7% to 62.7%.
• The number of people employed part time for economic reasons (AKA involuntary part-time workers) rose 1.4 million in March to 5.8 million.
• Average hourly earnings for all employees on nonfarm payrolls rose by $0.11 to $28.62 after increasing by $0.09 in February. Over the past 12 months, average hourly earnings have increased by 3.1%.

March brought a steep decline in many industries hiring in 2020. We saw the greatest employment change in leisure and hospitality with 459,000 jobs lost, most of which came from food services and drinking places (-417,000 jobs). While many industries lost jobs, the federal government added 18,000 jobs since 17,000 workers were hired for the 2020 census. Here are the industries that were affected in March:

• Food services and drinking places – 417,000 jobs lost
• Health care and social assistance – 61,000 jobs lost
• Professional and business services – 52,000 jobs lost
• Retail trade – 46,000 jobs lost
• Construction – 29,000 jobs lost
• Other services (e.g. personal and laundry services) – 24,000 jobs lost
• Federal government – 18,000 jobs added

Key industries like manufacturing and mining also saw job loss (-18,000 and -6,000, respectively).

Overall, the labor department jobs report suggests that due to the impact of the coronavirus and efforts to contain it, the economy is in poor shape. To track employment numbers and the health of the economy, check back for our summary of the BLS April jobs report on May 8, 2020.

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