The March jobs report will be released on Friday. Here’s what to expect
A “Help Wanted” sign hangs in the window of a restaurant in Medford, Massachusetts, USA, on January 25, 2023.
Brian Snyder | Reuters
Nonfarm payrolls are expected to barely recover in March as the bar for a healthy labor market continues to fall.
The US economy is expected to add 59,000 jobs for the month; This is a weak rate by the standards of previous years this decade, but it is enough to keep the unemployment rate at 4.4%.
If the forecast is reasonably accurate, it would represent above-trend employment growth for a labor market that created virtually no jobs last year.
Immigration restrictions, changing demographics, and geopolitical uncertainty have left companies reluctant to hire or lay off workers en masse; This led to a static labor market and a series of ridiculous monthly censuses from the Bureau of Labor Statistics. The BLS will release the number at 8:30 a.m. ET on Friday, but the stock market will be closed for the Good Friday holiday.
“We need to reconsider our idea of whether job numbers are good or bad,” said Guy Berger, chief economist at Homebase, which provides workforce management services to small businesses.
He added that a report showing job losses in February would “sound alarm bells about the state of the labor market.” “Yes, it was a very bad report, but it doesn’t scare anyone about the job market. I didn’t look at that report and say ‘wow, we’re on the verge of a recession’.”
The apparent unemployment rate
Echoing views expressed by the Chairman of the Federal Reserve Berger, along with Jerome Powell and other central bankers, said he is focusing more on the unemployment rate as an indicator of labor market stability.
With changes in the workforce, the increase in payroll must be increasingly smaller to keep the unemployment rate constant. The current unemployment rate of 4.4% is just 0.2 percentage points higher than a year ago, despite lackluster employment growth.
In a recent report, St. Louis Fed previous research updated at breakeven for business growth. The bank’s economists now think the number could be as low as 15,000 and as high as 87,000.
That’s a steep drop from a forecast as recently as April 2025 that put the breakeven level at 153,000, and an update in August of the same year that put the figure at between 32,000 and 82,000.
In other words, the labor market doesn’t need anywhere near the job growth it previously needed to keep the population near full employment.
“Things have been slowly getting worse over the last few years,” Berger said, but added: “There are no real signs that we are entering a recession.”
Some economists on Wall Street disagree. Goldman Sachs, Moody’s Analytics and others have recently raised the odds of a recession in the next 12 months; They focused on threats from a slowing employment outlook and rising energy costs.
Earlier this week, BLS data showed that hiring as a share of the workforce had fallen to 3.1%; this was the lowest level since the Covid recession of 2020 and before that in January 2011.
going slow
Still, Homebase’s data is consistent with other indicators, including ADP’s March private payrolls report, which showed modest increases in payrolls. February’s 92,000 job losses were due in part to a strike at health care provider Kaiser Permanente that laid off nearly 31,000 workers in California and Hawaii, which has since been resolved.
The economy depends heavily on healthcare for job growth. In fact, without the sector, there would have been a net loss of more than half a million jobs last year.
ADP reported Wednesday that private employment rose by 62,000, slightly above market expectations, but almost all of the growth was driven by health care, which added 58,000 jobs.
Nela Richardson, ADP’s chief economist, said even that figure masks underlying weakness.
“The question is whether it’s the economy that’s pushing growth forward, because a lot of these jobs are low-wage home health care aide jobs,” he said. “These are not full-time, full-benefit, 401(k) jobs that help support consumer spending.”
EY-Parthenon is among the Wall Street firms that raised their recession forecasts. Lydia Boussour, senior economist at EY-Parthenon, said healthcare “will be a key focus in the report.”
“We foresee a largely frozen labor market in 2026 with selective hiring, compressed wage growth, and strategic workforce resizing as labor supply remains historically stretched,” Boussour said in a note. he said. “Given the ongoing Middle East conflict, risks are weighted to the downside, with a 40% chance of recession.”
