Forecasters expect the government to report healthy job gains in March, after a lackluster showing in February.
The Labor Department releases its monthly report on employment and unemployment Friday morning. Analysts expect it to show that U.S. employers added between 150,000 and 200,000 jobs last month.
That would be a big improvement from February, when the government reported just 20,000 jobs added, but a slowdown from the last three months of 2018, when monthly job growth averaged 233,000.
“That number in February was a fluke,” said Nariman Behravesh, chief economist at IHS Markit. He expects the March figure will be up to 10 times higher — in line with an economy that’s still growing, albeit at a slower pace than last year.
“We’re talking about an economy that’s slowing,” said Diane Swonk, chief economist at Grant Thornton. “But for now, it should be another good year, where workers finally get to reap the benefits of a very long marathon of an expansion.”
Forecasters expect little change in the unemployment rate, which was 3.8 percent in February.
With unemployment hovering near 50-year lows, forecasters say there’s an upper limit on potential job growth.
“Businesses are having a hard time finding workers,” said Sarah House, a senior economist at Wells Fargo. “If they’re not able to fill these positions, that’s going to reduce the overall pace of job gains as well.”
A growing number of new hires are people who had left the workforce altogether, but were drawn back by the surge in job openings and wages that are growing more than 3 percent per year.
“The fact that we’re seeing wage growth accelerate, that’s helped pull more workers into the labor force,” House said. “While wages are picking up, maybe they’re not picking up quite as fast as they would be otherwise because those additional workers are coming in.”
That’s been a boon for business and helped to keep inflation in check.
“One of the complaints we hear all the time from our customers is a shortage of workers,” Behravesh said. “If in fact what this extremely low unemployment rate is doing is encouraging people who had given up or who weren’t that interested in looking for a job to come back into the labor force, that does mean that we can continue going down this path before wage inflation and eventually price inflation take off.”