Economy Adds Disappointing 120,000 Jobs In March

The nation added 120,000 jobs in March, far below expectations of the fourth straight month of 200,000-plus payroll gains. Payroll gains for January and February were revised, adding 13,000 to the February numbers, but subtracting 9,000 from January. The average workweek fell back to 34.5 hours and average hourly earnings improved. The number of people not in the labor force increased, but both the number of people employed and unemployed declined.

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The positive report continued a string of increases in payroll jobs â€" the 18th straight month of job gains and the seventh straight month payrolls have increased by 100,000 or more.

Nonetheless there were some weak spots, notably in the retail trade sector where jobs fell 33,600 in March, following a drop of 28,600 jobs in February. In two months, about 0.4 percent of retail jobs have been eliminated, primarily in department stores.

Temporary jobs, often considered an entry ramp for permanent employment, fell 7,500 in March after an outsized 54,900 increase in February.

The number of construction jobs dropped 7,000 in March after a decline of 6,000 in February, suggesting January’s jump of 18,000 construction jobs tracked unseasonably mild weather, which allowed construction firms to ramp up earlier than anticipated.

On the positive side, the manufacturing sector added 37,000 jobs, increasing for the 13th time in the last 15 months.

Credit-related jobs â€" specifically, “credit intermediation and related activities,” jumped 11,000 in March, with depository credit intermediation adding 6,100 jobs and commercial banks adding 5,700 lending positions.

The report also showed the number of real estate jobs increased 5,100 in March, following a gain of 5,800 in February.

The decline in the unemployment rate â€" to its lowest level since February 2009 â€" came as the labor force fell 164,000 â€" 133,000 fewer “unemployed” and 31,000 fewer “employed.” The formula for the unemployment rate is to divide the number of people officially counted as unemployed (out of work, available for work and looking for work) by the total labor force (employed plus unemployed). If, as happened in March, the labor force change is driven by a drop in unemployment, the unemployment rate will decline.

Employers in March also reduced average weekly hours, which allowed more individuals to remain employed. If average weekly hours had remained at the February level of 34.6, employment would have dropped an additional 381,000 in March.

The closely watched alternate measure of unemployment â€" which includes individuals working part time for economic reasons and those “marginally attached” to the labor force â€" fell in March to 14.5 percent from 14.9 percent in February.

While the detailed breakdown of the unemployment data was largely encouraging, the number of persons unemployed for less than five weeks rose for the second straight month; the number of long-term unemployed â€" 27 weeks or longer â€" fell for the 8th time in the last nine months.

The number of job-leavers, often an encouraging sign suggesting workers have confidence in their ability to find a new job, increased in March for the second straight month, but the number of re-entrants to the labor force fell.

The employment population ratio, which measures the percent of the over-16 population classified as employed, fell back to 58.5 percent - its January level - after increasing to 58.6 percent in February. It was 62.7 percent when the Great Recession began in December 2007 and 60.6 percent when President Obama took office in January 2009.

The unemployment rate for the prime home-buying age cohort â€" 25 to 34 â€" improved to 8.6 percent in March from 8.7 percent in February, while the unemployment rate for those over 55, generally the prime home-selling age cohort, jumped to 6.2 percent in March from 5.9 percent in February.