US employers add 178K jobs in March in stronger-than-expected report

Hiring in March was surprisingly strong, signaling the labor market was stabilizing early on in the Iran war.US employers added 178,000 jobs in March – above expectations of 59,000 added jobs and a rebound from a revised decline of 133,000 the previous month, the Bureau of Labor Statistics said Friday.The unemployment rate ticked down to 4.3%, from 4.4% in February.While the unemployment rate posted a decline, that was largely because the labor force dropped by 396,000.The percent of working-age Americans in the labor force fell to 61.9%, the lowest level since November 2021.Revisions to the previous two months lowered employment in January and February down by a combined 7,000.The stock market was closed in observance of Good Friday, making it difficult to glean a reaction from investors. But the new jobs report indicates that the Fed – which has been deeply divided over whether to prioritize inflation risks or weak unemployment – can likely shift its focus to inflation, which typically means higher interest rates.“The US labor market continues to be resilient, defying even the harshest skeptic,” Jamie Cox, managing partner for Harris Financial Group, said in a note Friday. “The bad news is, if the labor market remains this stable, it will be very difficult to justify further rate cuts.”The Bureau of Labor Statistics’ surveys for the month, however, were completed by March 12, less than two weeks into the US and Israel’s war with Iran, so the results are largely backward-looking.Since then, oil has soared above $100 a barrel and gasoline has hit more than $4 a gallon.Analysts have warned that attacks on key energy facilities in the Middle East could leave prices elevated even if the war ends soon, while economists are concerned higher energy costs could ripple across consumer prices and slow job growth.“Although most of this data is from the period prior to the war, it establishes a baseline of a resilient economy,” Chris Zaccarelli, chie...