There were no big surprises in this month’s Employment Situation Summary from the Labor Department: the economy added 215,000 jobs, just exceeding economists’ predictions, and the unemployment rate rose slightly, from 4.9 percent for February to 5 percent for March. Perhaps the biggest news, however, was wage growth. Average hourly earnings increased 7 cents to $25.43, after a 2-cent decline the previous month. But some experts feel that we’re still not seeing the kind of wage growth expected from a market that’s supposedly approaching full employment.
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“Wage growth for nonsupervisory workers was consistent with the modest growth rate we’ve consistently seen for a few years now,” says Harry Holzer, former Chief Economist of the U.S. Department of Labor and author of Where Are All The Good Jobs Going?, in a statement. “The somewhat better figure for all workers indicates better wage growth for professional and managerial employees with higher education. But we do not yet see a clear breakout of wage growth that we would expect in a tightening labor market.”
The PayScale Index, which measures the change in wages for employed U.S. workers, was updated this morning to reflect 1.8 percent growth in wages for Q1 2016. The Index forecasts 2 percent growth for Q2.
Several industries added jobs last month, including retail trade (+48,000 jobs), construction (+37,000 jobs), healthcare (+37,000 jobs), food services and drinking places (+25,000 jobs), and financial activities (+15,000 jobs). Professional and business services remained essentially flat for the third month running. Manufacturing shed 29,000 jobs, while mining continued its decline, losing 12,000 jobs. Wholesale trade, transportation and warehousing, government, and information showed little change for March.
The average workweek for private nonfarm payrolls remained unchanged at 34.4 hours last month. Holzer says that the unemployment rate, although slightly higher at 5 percent, “is not statistically significant, and is driven entirely by a small uptick in the labor force participation rate,” which was little changed at 63 percent, but has risen 0.6 percentage point since September.
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