The March employment report pretty good overall but was a bit disappointing on the top line.
The economy created 431,000 jobs, which was less than expectations of 490,000, but it was still a strong number. The prior two months were revised up by 95,000 jobs. Job gains were widespread, with leisure and hospitality once again leading the way with an increase of 112,000, the most of any single industry.
With March’s report, the economy has now recovered 92.8% of all the jobs lost during the shutdowns of March and April 2020. But there are still 1.6 million jobs to be recovered. The unemployment rate dropped from 3.8% to 3.6%, just above the pre-pandemic level of 3.5%, which was the lowest in over 50 years.
However, the unemployment rate does not take into account the 99 million people who are metaphorically “sitting at home.” Those people are classified as “not participating in the labor force.” Thus the labor force participation rate gives a better picture because it counts the percentage of the population that is participating in the labor force and driving the economy. That number rose 0.1% to 62.4%, up from the April 2020 low of 60.2%. However, it’s still 1% below the 63.4% level from before the pandemic. The drop in Covid cases is contributing to the job gains. The number of people who couldn’t look for a job because of Covid dropped from 1.2 million in February to 900,000 in March.