An extremely volatile start to 2016, which saw global markets nosedive and global-growth worries spike, didn’t have a significant, lasting impact on the U.S. labor market, according to employment figures released by the Labor Department Friday.
The closely watched March jobs report showed the U.S. economy added 215,000 jobs last month, more than the 205,000 new jobs expected. Digging deeper into the figures, the labor force participation rate ticked up to 63%, though it helped push the jobless rate up from 4.9% in February to 5% in March. Additionally, the underemployment rate – or the number of people working part time but seeking full-time work – climbed to 9.8% from 9.7% the month prior.
“The uptick in the unemployment rate isn’t alarming, especially when it occurs within the context of an increase in the participation rate,” Ron Sanchez, chief investment officer of Fiduciary Trust Company International, said. “That’s an encouraging sign, and the Fed is likely to view it as such.”
Sanchez called the report “spot on” in terms of expectations.
The non-farm payrolls report also showed that average hourly earnings, a closely-watched metric by the central bank, rose 0.3% during the month after contracting in February. The uptick was higher than expectations for a 0.2% rise in wages. Year over year, wages were up 2.3%.
Wages have been a sticking point for the Federal Reserve, which has been slow to raise rates in the face of more challenging global economic conditions. The central bank opted to raise rates for the first time in nearly a decade, by a quarter of a percent, in December, and said it expected to raise rates four more times before the end of 2016. However, thanks to the tumultuous first quarter, the Fed backed off those plans, and Fed Chief Janet Yellen has remained dovish on future increases.