March jobs report: U.S. economy loses 701,000 payrolls, unemployment rate jumps to 4.4%
The U.S. economy shed jobs for the first time in a decade in March and the unemployment rate rose more than expected, as the coronavirus pandemic began to erode domestic economic activity.
The Department of Labor released its monthly jobs report at 8:30 a.m. ET Friday. Here were the main metrics from the report, compared to consensus data compiled by Bloomberg:
Change in non-farm payrolls, March: -701,000 vs. -100,000 expected and +275,000 in February
Unemployment rate, March: 4.4 expected and 3.5% in February
Average hourly earnings, month on month: 0.4% vs. 0.2% expected and 0.3% in February
Average hourly earnings, year on year: 3.1 expected and +3.0% in February
The reference period for the March jobs report extended through the 12th of the month, meaning that the data was captured before much of the country went on lockdown in response to the coronavirus pandemic. Namely, this jobs report excludes the two-week period at the end of March that saw new unemployment claims skyrocket to a combined 9.9 million.
But even in the early stages of the outbreak, the economy already began shedding huge numbers of jobs, the Labor Department report showed. Non-farm payrolls fell by 701,000 in March for the first decline since September 2010, and far exceeded the number of job losses anticipated.
That marked a stunning reversal after the economy grew payrolls in both February and January of this year by 214,000 and 275,000, respectively. And the unemployment rate jumped from February’s 50-year low of 3.5% to 4.4% in March, the highest level since August 2017.
“March data from the establishment and household surveys broadly reflect some of the early effects of the coronavirus (COVID-19) pandemic on the labor market,” the Labor Department said in a statement. “We cannot precisely quantify the effects of the pandemic on the job market in March. However, it is clear that the decrease in employment and hours and the increase in unemployment can be ascribed to effects of the illness and efforts to contain the virus.”
In a report Thursday, the Congressional Budget Office said it expected the unemployment rate to top 10% in the second quarter, reflecting the recent historic surge in new jobless claims. And Bank of America economists said Thursday they expected as many as 20 million jobs will be cut in the coming couple of months amid the outbreak, leading to a peak unemployment rate of 15.6%.
At the height of the global financial crisis, the unemployment rate reached as high as 10% in October 2009.