What factors, such as inflation, affected the monthly jobless report?（在线收听）

What factors, such as inflation, affected the monthly jobless report?

Transcript

The Labor Department is issuing its monthly report card on jobs and unemployment. The job market has been unusually tight, which is pushing up both wages and prices.

A MARTINEZ, HOST:

The U.S. job market continues its rapid recovery. This morning, the Labor Department reported employers added 431,000 jobs last month while the unemployment rate fell 3.6%. Pandemic fears are fading for the moment, and that's helping to draw more people back into the workforce. President Biden hailed the news.

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PRESIDENT JOE BIDEN: And more and more Americans get jobs as they do, it's going to help ease the supply pressures we've seen. And that's good news for fighting inflation. And it's good news for our economy, and it means that our economy has gone from being on the mend to being on the move.

MARTINEZ: NPR's Scott Horsley joins us now with all the details from today's jobs report. Scott, there had been a little bit of uncertainty about how the economy would perform after Russia's invasion of Ukraine. But it seems like the job market is pretty resilient.

SCOTT HORSLEY, BYLINE: It really does. There had been some indications that we might see a sharper drop in hiring as gasoline prices soared and consumers had less money to spend in other parts of the economy. But hiring seems to be holding up very well. Bars and restaurants added another 61,000 jobs in March, retailers added 49,000 jobs, factories, 38,000. What's more, job gains for January and February were revised up by a total of 95,000 jobs. And as you say, the unemployment rate fell from 3.8% to 3.6%. What's more, we saw unemployment decline across the board, you know, for men, women, Latinos, Asian Americans. African Americans actually saw the biggest drop in unemployment last month. Although at 6.2%, the Black unemployment rate is still elevated.

MARTINEZ: So still fair to say, though, that this remains a tight job market.

HORSLEY: Yeah, very tight. Even that 3.6% unemployment rate might understate how tight the job market is. In ordinary times, there are usually about two unemployed workers for every job opening. Right now, we've got almost the opposite situation. At the beginning of March, there were nearly two vacant jobs for every unemployed worker. So businesses are having to look harder to find scarce labor. They are raising wages. On average, wages are up 5.6% over the last 12 months. That's certainly good for workers. But those wage gains are worrisome for the Federal Reserve because to the extent that employers pass the cost of those higher wages on to customers, that can make already high inflation even higher. Here's how Fed Chairman Jerome Powell described it during a gathering of business economists last week.

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JEROME POWELL: This is a labor market that is out of balance, that really has an excess of demand over supply. It's great for workers, but we need the labor market to be sustainably tight.

HORSLEY: And Powell and his colleagues are worried that what we have right now is not sustainable, that if inflation continues to climb unchecked, it will ultimately derail the economy and keep the U.S. from getting back to full employment. So that's why you see the Fed beginning to raise interest rates in an effort to tamp down demand and get prices under control.

MARTINEZ: What else jumps out at you from today's report?

HORSLEY: Well, on top of the healthy number of jobs added in March and the drop in the unemployment rate, it's good to see how many people joined or rejoined the workforce last month. Four hundred eighteen thousand people came off the sidelines in March and started working or looking for work. That follows an increase of more than 300,000 in February. So the labor force is still smaller than it was before the pandemic, but the gap has narrowed, and that's good to see.

Part of this, of course, is a result of the improving health outlook. If you go back to early February, there were almost 8 million people who told the Census Bureau they couldn't work because either they were sick with COVID or taking care of somebody who was. By early March, that number had dropped to less than 3 million. Julia Pollock, who is the chief economist at the job search website ZipRecruiter, has seen an uptick in the number of people searching for jobs online.

JULIA POLLAK: People have had enough of sitting around doing nothing. Also with COVID relief payments fading away, people are starting to feel a little bit more financial pressure to come back to work.

HORSLEY: Pollock is calling this the great return, which would be a partial reversal of what some had dubbed the great resignation. Now, it is still the case that millions of people are quitting their jobs every month, but in most cases, they're quitting in order to take another, usually better, job. So really what we're seeing is an employment market with a whole lot of churn and a lot of moving pieces.

MARTINEZ: NPR's Scott Horsley. Scott, thanks a lot.

HORSLEY: Good to be with you.