The US labor market in March snapped back to life. The catch? It’s done this every other month for almost a year.
Data from the Labor Department published Friday showed the US economy added 178,000 jobs in March after February’s revised loss of 133,000. In March, the unemployment rate edged down to 4.3%.
On its face, that looks like a sharp turnaround. In context, it looks more like another violent swing in a labor market that has become unusually hard to read. And that whiplash nature of the labor market is the real story in the economy right now.
For 10 straight months, monthly job growth has alternated between positive and negative. The past three months alone went from a gain of 160,000 to a loss of 133,000 to a gain of 178,000.
Each report feels huge. Each report also says less on its own.
The history here makes the current moment even more striking.
Looking back through the full payroll series to 1939, there appear to be only two prior stretches with meaningfully similar month-to-month whiplash: one in 1959 lasting five months and another six-month stretch spanning from late 1969 into early 1970.
If the current swing in monthly job gains and losses were a stock chart, technicians might call the green trend lines on the chart above a broadening megaphone pattern: wider swings, more disagreement, less clarity.
And while technical analysis doesn’t work with economic data, that framing isn’t a bad way to think about the labor market. The monthly data swings are becoming more extreme, even as the longer-term trend continues to weaken.
The 12-month average in net payroll growth has now slowed to roughly 20,000 a month. So, while the headlines keep lurching from good to bad and back again, the broader backdrop remains one of cooling.
That leaves investors, employers, and policymakers with a labor market sending several messages at once.
For workers, the headline trend says jobs are still being created. But beneath that, the picture is less reassuring.
The share of unemployed workers who have been out of work for 27 weeks or longer ticked up again in March. The number of “marginally attached” workers also rose, as did the number of discouraged workers. Layoffs may still be relatively low, but getting back into the workforce appears to be growing harder for people already on the outside.
For employers, the message is murky in a different way. March’s rebound suggests many firms are still hiring. But the pattern does not look broad, steady, or confident.
Much of the March gain came from healthcare, which appears to have rebounded after a strike-related distortion weighed on February’s report — 90,000 jobs were added to that sector last month.