US employers add just 88,000 jobs in March
U.S. employers added just 88,000 jobs in March, the fewest in nine months and a sharp retreat after a period of strong hiring. The slowdown may signal that the economy is heading into a weak spring.
The Labor Department said Friday that the unemployment rate dipped to 7.6 percent, the lowest in four years, from 7.7 percent. But the rate fell only because more people stopped looking for work. People who are out of work no longer are counted as unemployed once they stop looking for a job.
The percentage of working-age adults Americans with a job or looking for one fell to 63.3 percent in March, the lowest such figure in nearly 34 years.
Stocks plummeted after the report but narrowed their losses later in the day. The Dow Jones industrial average was down about 40 points at the end of the day. Broader indexes also declined.
March’s job gain was less than half the average of 196,000 jobs in the previous six months. The government said hiring was even stronger in January and February than previously estimated. January job growth was revised up from 119,000 to 148,000. February was revised from 236,000 to 268,000.
Several industries cut back sharply on hiring. Retailers cut 24,000 jobs in March after averaging 32,000 in the previous three months. Manufacturers cut 3,000 jobs after adding 19,000 in February. Financial services shed 2,000.
Some economists said retailers might have held back on hiring because March was colder than normal. That likely meant that Americans bought fewer spring clothes and less garden equipment. Clothing stores shed 15,000 jobs, and building material and garden supply stores shed 10,000.
In March, average hourly pay rose a penny, the smallest gain in five months. Average pay is just 1.8 percent higher than a year earlier, trailing the pace of inflation, which rose 2 percent in the past 12 months.
The Labor Department uses a survey of mostly large businesses and government agencies to determine how many jobs are added or lost each month. That’s the survey that produced the gain of 88,000 jobs for March.
The government uses a separate survey of households to calculate the unemployment rate. This survey found that the number of people either working or looking for work fell by nearly 500,000. It was the sharpest such drop since December 2010. And the number of Americans who said they were employed dropped nearly 210,000.
The percentage of working-age adults in the labor force is a figure that economists call the participation rate. At 63.3 percent, it’s the lowest since 1979. Normally during an economic recovery, an expanding economy lures job seekers back into the labor market. This time, many have stayed on the sidelines, and more have joined them.
Longer-term trends have helped keep the participation rate down. The vast generation of baby boomers has begun to retire. The share of men 20 and older in the labor force has dropped as manufacturing has shrunk.
Some who have left the job market are getting by on government aid, particularly Social Security’s program for the disabled. The share of women working or looking for work has plateaued, and fewer teenagers are working.
Heidi Shierholz, says the labor force participation among those age 25 to 54 — “prime age” workers — has dropped to 81.1 percent. It hasn’t been lower since 1984.
This could be the fourth-straight year that the economy and hiring have shown strength in the winter and early spring, only to weaken afterward. Last year, for example, job gains averaged 262,000 a month in the January-March quarter, but then fell to a pace of 108,000 in the April-June quarter.
Economists blame a range of factors for the trend. Europe’s financial crisis intensified in 2010 and 2011. And Japan’s earthquake and tsunami disrupted U.S. manufacturing in 2011.