Friday, April 1, 2011

Payrolls Up 216,000; Unemployment Rate Down Slightly to 8.8%

The Bureau of Labor Statistics reported that non-farm payroll employment rose by 216,000 in March. This follows a slightly revised gain of 194,000 in February (previously reported to be 192,000). The month’s payroll gain was the strongest since the Census Bureau hiring of last year. Private sector employment rose by 230,000. This was a similar to the pace seen in February.

Jim Chessen, ABA Chief Economist stated, “Though it is likely that job growth will vary month to month going forward, private sector hiring activity is now at the point where it is starting to chip away at unemployment. This is an encouraging development.” It takes about 150,000 jobs created each month in order to absorb new labor market entrants.

In March, the unemployment rate fell 0.1 point to 8.8%. Though the payroll growth seen in March is consistent with a modest unemployment rate decline, the drops that occurred a few months ago are not likely as positive of an indication. About three quarters of a million people left the labor force from November to January. This is likely due to increased levels of discouraged workers. The labor force participation rate remains at a cyclical low of 64.2%. If this rate begins to move upward back to a historical norm, even will solid payroll growth, the unemployment rate may stay high in the near to intermediate term.

Payroll Change (000s)2161946815293171
    Goods Producing317338481
    Private Sector23024094167128143
Unemployment Rate8.
Labor Force Particip. R.

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