In this month’s highly anticipated Bureau of Labor Statistics jobs report, the economy added 192,000 employees to the nonfarm payroll, and the unemployment rate remained unchanged at 6.7 percent.
The professional and business services sector was the big winner this month, adding 57,000 jobs in March, with temporary service positions accounting for 29,000 jobs. The healthcare
and construction industries also grew steadily, with each sector adding 19,000 jobs. Government employment changed little in March, with local governments adding 8,000 jobs, gains that were offset by a decline of 9,000 in federal government jobs.
U.S. Manufacturing Sector Keeps Forward Momentum
growth accelerated for a second consecutive month in March, according to the Institute for Supply Management’s (ISM) index of national factory activity. The index increased slightly to 53.7 last month, up from February’s reading of 53.2. Any reading above 50 points is indicative of economic expansion. Although the report remains below its recent peak of 57 in November, a rebound in the production subindex from 48.2 to 55.9 helped fuel the overall index gain. Meanwhile, there was some disappointing news in manufacturing employment, which fell from 52.3 to 51.1 — the weakest index reading since June 2013.
The manufacturing outlook received a positive boost from the Commerce Department’s most recent report, which showed that new orders for manufactured goods jumped 1.6 percent in February, the largest rise since last September. In particular, the February gain reflected a rebound in orders for commercial aircraft and autos. Being higher than expected, the rebound indicates the economy may be regaining momentum as spring emerges.
U.S. Services Sector Also Grows this Month
Growth in the U.S. services sector accelerated in March, rising alongside the service-related employment index, which returned to expansionary territory. According to the ISM, its services sector economic activity index measured 53.1 in March. This was welcome news after a highly disappointing February report of 51.6, the lowest reading since February 2010 and a reflection of the effects of winter weather on business activity.
The ISM’s service sector employment index rose to 53.6 from 47.5 in February, which had been the lowest reading for the subindex since March 2010. Although service industry employment growth remains below its seven-year high of 57.9 in August, the recent numbers indicate a thawing out and a return to a higher pace of business activity.
Despite Slight Rise in Jobless Claims, Layoffs Remain Low
The number of Americans who applied for unemployment benefits grew slightly in March, but initial jobless claims continue to hover near their lowest level since 2009, at the end of the recession. Initial jobless claims gauge whether layoffs are rising or falling, and changes in the number of people seeking unemployment benefits tend to correlate with how many net jobs the economy is adding.
In the week ended March 29, new jobless claims jumped by 16,000 to a seasonally adjusted 326,000, and the average number of new claims filed in March increased by 250 to 319,500. Overall, the number of layoffs remains low and helps to support an improving job market.
Employee Confidence Level Springs Forward
Randstad’s U.S. Employee Confidence Index rose to a six-month high in March, increasing 3.1 points from February to 57.1. Further, workers reported the highest level of job security since May 2008, with 77 percent indicating it is unlikely they will lose their positions. The data findings point to an uptick in American worker confidence about the workplace, the strength of the economy, job availability, their potential to find jobs and the future of their current employers.
The Randstad employee confidence data mirrors findings from the Conference Board Consumer Index, which climbed to 82.3 in March, up from 78.3 in February. This marked the first reading above 82 since June 2013 and the highest reading since January 2008. Both indices reveal growing optimism and confidence about increased job prospects and point to a candidate-driven labor market. In fact, Randstad’s most recent transition index, which tracks workers’ likelihood to conduct a job search, indicated one-third of workers are likely to look for a new job. As the employment market continues to improve and favor job seekers, it will be important for companies to refocus their retention efforts to engage employees and avoid turnover.
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