Key Takeaways:
The economy added 916,000 jobs in March, a 142% increase over February.
Leisure and hospitality were the big winners with 280,000 new jobs in March.
Total job openings across the economy topped 7.37 million.
Prediction: Job openings numbers will rise to around 7.5 million for March.
The economy added 916,000 jobs in March
Nonfarm payroll employees added 916,000 jobs to the economy in March. The majority of jobs were added in leisure and hospitality, public and private education, and construction. The unemployment rate decreased to 6.0 percent.
According to the Bureau of Labor Statistics, employment in leisure and hospitality increased by 280,000 jobs in March, with two-thirds of the increase coming from restaurants and drinking places. Despite this rapid growth, the leisure and hospitality segment remains 3.1 million jobs behind its pre-pandemic February 2020 number.
Public and private education added another 76,000 and 64,000 jobs respectively, while the construction industry added 110,000 new hires. This is a reversal of the trend from last month, where construction jobs decreased by 56,000 jobs, a loss largely attributed to cold weather.
US still has over 7 million jobs available
According to the Job Openings and Labor Turnover Survey (JOLTS) from the Bureau of Labor Statistics (BLS), there were 7.37 million job openings in February, and the job openings rate rose to 4.9%—the highest number on record.
The JOLTS survey has a two-month lag, meaning March numbers are still a month away. However, Emsi data, which tracks job posting analytics in real time, predicts that the number of job openings will rise even higher to 7.5 million openings for March based on the growth we see in job posting activity (job postings from Emsi and job openings from JOLTS tend to track closely with each other).
According to our job posting analytics, there were around 5.4 million brand new job postings in March, an 18% increase from February and a 53% increase from one year ago. Some of the big movers include logistics (especially truckers) which added 290,000 new job postings, an increase of 25% from last month and nearly 70% from last year. Restaurants posted 200,000 new positions, a 33% one-month increase in March and an overall 50% increase from 2020. Hotels saw an even bigger 75% increase in year-over-year postings.
Talent shortage expected to increase
Even though employers added nearly 1 million new jobs, there are over 7 million job openings in the marketplace. At the same time, the labor force participation rate is at a near record low of just below 62%, meaning millions of working-age Americans remain on the sidelines and aren’t even trying to fill those open postings.
Notably, the employment-population ratio is 57.8%. This statistical proportion measures the amount of adults (16+) that are employed. This is 3.3 percentage points lower than in February of 2020.
Wage inflation will likely become a growing factor. Already, employers are paying big bucks to attract new employees.
But, the good news is that all those millions of dislocated and unemployed workers who are looking for work have plenty of places to look for opportunity! Much work can be done to help these dislocated workers find their way to all these open positions. They just need to find a way to connect.
Emsi has released new tools to help, including Emsi Open Titles which helps businesses standardize their job titles to better evaluate current employees and promote from within. And next week, we will have a big announcement on another tool to help companies address these challenges.
The bottom line is that organizations must rethink how they approach the labor market, including learning how to better mobilize from within and how to help new workers retrain for the positions they desperately need to fill. Because, as the shortage of talent intensifies, competition to retain employees and to find new talent will become much tougher.