This morning’s jobs report generated surprisingly little interest from markets that are reeling from President Trump’s recent tariff announcements and China’s aggressive response. In March, the U.S. economy added 228,000 jobs, reflecting a significant improvement over February’s revised total of 117,000. This result surpassed analysts’ expectations by 93,000 and marked the fifth positive surprise over the past year, with four of those reports showing job growth exceeding 200,000. A closer look at the report reveals that service-providing sectors contributed 94.3% of the 209,000 private sector jobs added.
The retail sector saw a resurgence, adding 23,700 positions, while government payrolls increased by 19,000—an encouraging acceleration from February’s marginal gain of 1,000. Natalia Lojevsky from CIFC Asset Management noted that even though the data may seem outdated in light of recent tariff developments, this strong job growth could positively influence investor sentiment as the weekend approaches. Moreover, the report offered insights into March inflation, indicating that average hourly wages increased by 0.3%, slightly above the previous month’s 0.2%. However, year-over-year wage growth eased to 3.8% from 4.0%, falling just short of the anticipated 3.9%.
While still above the Federal Reserve’s 2% inflation target, this trend adds complexity to the Fed’s policy decisions, according to Jeffrey Roach from LPL Financial. The jobless rate unexpectedly rose to 4.2%, contrary to expectations of remaining at 4.1%, while the labor force participation rate improved slightly to 62.5%. This indicates a gradual return to the labor market, which can create upward pressure on the unemployment rate. Chris Zaccarelli from Northlight Asset Management remarked that the rise in the unemployment rate was due to an increase in labor force participation.
Lastly, breaking down unemployment by race shows a decrease among White Americans to 3.7%, while Black unemployment rose to 6.2%, expanding the gap to 2.5 percentage points.