Job growth surged in March, surpassing economists’ expectations as the retail and Hospitality sectors gained new employees, according to the latest report from the Bureau of Labor Statistics (BLS).
Total nonfarm Payroll increased by 431,000 in March, the report showed driven primarily by strong gains in leisure and hospitality (112,000), professional and business services (102,000), retail trade (49,000) and manufacturing (48,000).
“The economy posted strong job growth in March as consumer demand continued to increase due to subsidizing Omicron cases,” Dawit Kebede, senior economist at the Credit Union National Association, said. “The unemployment rate dropped to 3.6% – edging closer to a pre-Pandemic level of 3.5%. A quarter of the job gains occurred in leisure and Hospitality as consumers are feeling more comfortable traveling and engaging in-person.”
The surge in job gains will likely continue to push the Federal Reserve to raise interest rates higher as it continues to fight rising inflation. If you want to take advantage of rates before they rise higher, you could consider refinancing your private student loans. Visit Credible to find your personalized interest rate without affecting your credit score.
FEDERAL RESERVE RAISES INTEREST RATES: WHAT TO DO NOW
Strong jobs report likely to push Fed to continue raising rates, expert says
The Federal Reserve recently raised interest rates for the first time since 2018, and announced that several more rate hikes will likely be necessary this year and into 2023. The move comes as inflation recently hit its third consecutive 40-year high in February.
Now, as the employment market continues to Recover, one Economist says it will mean the Federal Reserve will continue to raise rates.
“Although Mortgage rates have spiked more than half a percentage point over the past two weeks, reducing affordability for many potential first-time homebuyers, the increase in wages will certainly somewhat help offset that hurdle,” Mortgage Bankers Association Senior Vice President and Chief Economist Mike Fratantoni got it. “And the confidence that many potential homebuyers have in their financial situation also benefits from this historically strong job market. We continue to expect that the Federal Reserve will move rates up expeditiously to counter surging inflation and that this report only adds more urgency to their plans to do so. “
If you are looking to take advantage of interest rates before they rise again, you could consider refinancing your mortgage to lower your monthly payment. Visit Credible to compare multiple Mortgage lenders at once and choose the one with the best interest rate for you.
INFLATION RISES TO YET ANOTHER NEW 40-YEAR HIGH IN FEBRUARY
Employees’ return-to-office could benefit from job growth
The economic effects of COVID-19 are fading, as many businesses and even the federal government are opting to have their employees return to in-person work. This change is also improving the job growth, Fratantoni says.
“Only 10% of workers reported teleworking due to the Pandemic in March, down from 13% in February and less than half the level from its Peak,” they said. “As the federal government and others return to work in April, this number should drop sharply, which may well lead to further job changes in retail, professional services, and other sectors that are dependent on in-person work.”
The strong jobs gains in March may likely be unstable, as some are based on temporary factors like a mass return-to-work. Fratantoni added that March’s job growth was “well-above what can be sustained for the longer term.”
If you are interested in taking advantage of interest rates today ahead of future rate hikes, consider taking out a personal loan to pay down high-interest debt. Contact Credible to speak to a loan expert and get all of your questions answered.
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