Washington
CNN
—
The latest monthly employment report showed US hiring slowed in March but remained resilient, with growth in services such as bars and restaurants but weakness in construction and manufacturing.
Leisure and hospitality helped boost wages last month, a trend that has continued since the economy began to recover from the pandemic. Government employers and the professional and business services industry also hired last month. But employment declined in construction, manufacturing, and non-durables.
Here’s a look at where employment rose last month and where it fell, according to a report from the Bureau of Labor Statistics.
Last month, leisure and hospitality employers added 72,000 jobs, more than any other industry. But the sector is still 2.2% below its pre-pandemic staffing level, with fewer jobs in March than it had in the previous six months.
“The gains we continue to see in healthcare, leisure and hospitality are because these industries are still trying to recoup past losses,” said Diane Swank, chief economist at KPMG. “So, the service sector has held out, but has shown some signs of cooling.”
Public employers added 47,000 jobs in March, primarily by hiring state and local governments, which usually struggle to add workers in a tough job market. Healthcare businesses added 34,000 jobs and jobs in the business services sector, which includes many jobs such as accountants, engineers and consultants, grew by 39,000 people. Government jobs also remain at 314,000, or almost 1.4% below their pre-pandemic level.
However, cracks are beginning to form in the labor market in the production of goods. The construction industry lost 9,000 jobs in March, the first decline in construction employment in more than a year and the sector’s largest job loss since May 2021, although the fall is still just under 1.1%.
Demand for housing fell sharply late last year when the Federal Reserve raised interest rates sharply, pushing up the cost of borrowing for homebuyers. But while new housing construction has slowed over the past year, construction jobs have remained, largely due to a backlog in construction projects, Swank said. She added that the decline in construction employment in March was due to weak housing demand and “unusually harsh spring weather.”
Another victim of the Fed’s rate hike was manufacturing, which also lost jobs last month, according to the BLS.
“Manufacturing is one of the most interest-sensitive industries, as are technology and financial services, so it’s no surprise there are job cuts,” said Sinem Buber, lead economist at ZipRecruiter.
Data from the Institute of Supply Management released this week showed that the manufacturing sector contracted in March for the fifth month in a row. The poll index fell to its lowest level since May 2020.
Buber added that the non-durables industry also saw a decline in hiring, which was likely due to lower consumer demand for apparel and home goods.
“These products are slightly better at responding to any changes in the market, so we see the industry responding faster than durables,” Buber said.
Temporary jobs also fell by nearly 11,000 in March, according to Beth Ann Bovino, chief economist at S&P Global, which could signal the job market will soften further in the coming months.
“If you start to see a reduction in temporary hiring, it usually means that businesses are seeing some weakening in the revenue stream, which is one of the first signs of weakening in the labor market,” Bovino said.