March Jobs Report Commentary from MBA's Mike Fratantoni

The following is MBA SVP and Chief Economist Mike Fratantoni’s reaction to this morning’s U.S. Bureau of Labor Statistics report on employment conditions in March.

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“The unemployment rate in March increased to 4.2% and wage growth slowed to 3.8%. However, payroll growth bounced higher to a 228,000 gain, a pickup from a 117,000 gain in February. Job gains from the first two months of the year were revised down by a cumulative 48,000. On net, the overall picture changed little during the time this data was collected – the job market was softening somewhat, but there were no indications of a sudden slowdown.

“Most sectors within the economy showed modest job growth. Unsurprisingly, given the DOGE headlines, federal government payrolls decreased by 4,000 over the month, with further decreases anticipated.

“Last month, there was a sharper increase in the U-6 measure of underemployment. That metric remained elevated at 7.9% in March. This increase signals that many who have lost jobs are having difficulties regaining full employment again but are able to get part-time or other work.

“In light of the tariff announcements this week and the sharp drop in stock markets around the world in response, these data are likely not capturing the moment with respect to the actual strength of the economy. However, the Federal Reserve, in data-dependent mode, is likely to remain cautious with respect to any rate cuts so long as inflation is above target, and the job market data continues to come in strong.”