Joanie Billie of EmployBridge will explain how the US economy is doing in the March employment statistics on “How to make money.”
U.S. job growth has repeatedly exceeded expectations since the start of the year, but there have been consistent factors behind the surprisingly strong numbers. It’s the government.
According to the latest data released by the Ministry of Labor, Employers added 303,000 jobs In March, this easily exceeded the 200,000 increase expected by economists at LSEG. The unemployment rate fell slightly to 3.8% from 3.9% in February.
But digging deeper into the report reveals that the U.S. government has contributed significantly to hiring since the start of the year, which economists argue belies a strong labor market.
“It’s a little disconcerting to see the fact that the job growth is happening in sectors that aren’t necessarily our own production sectors,” Jeffrey Roach, chief economist at LPL Financial, told FOX Business.
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Transportation Security Administration (TSA) personnel at Ronald Reagan National Airport in Arlington, Virginia, on November 21, 2023. (Jiang Haiyun/Bloomberg via Getty Images/Getty Images)
Public sector employment at the federal, state, and local levels increased by 194,000 people in the first three months of 2024. This accounts for about a quarter of all jobs created in January, February and March. By comparison, during the same period in 2019, before the pandemic began, government jobs accounted for just 11% of all jobs created.
“You never want to see government become the primary driver of employment,” Roach added. “They will be furloughed soon, so it could go either way. We may see a strong recovery in employment, but once a slow patch emerges, that trend could reverse. there is.”
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State and local governments are hiring teachers and police officers in response to a post-pandemic travel surge, and the federal government is hiring TSA officers.
The government has experienced severe job losses during the pandemic, with state and local governments furloughing or laying off thousands of employees in anticipation of budget shortfalls. Additionally, many workers left their jobs for more competitive wages in the private sector, leaving the government to address the labor shortage.
Public sector employment at the federal, state, and local levels increased by 194,000 people in the first three months of 2024. ((Amanda Andrade-Rose/The Washington Post via Getty Images)/Getty Images)
While private sector employment growth slowed sharply from 4.3% in 2022 to 2.3% in 2023, the pace of government hiring is accelerating further. Public sector employment growth will rise from just 1% in 2022 to 2.7% in 2023, the highest year-on-year growth rate since 1990, according to Fitch Ratings.
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This divergence suggests that while hiring is accelerating within the government, it is slowing in the private sector, which includes jobs in manufacturing, research and development, construction, and more. This trend is likely to continue in 2024.
“The post-pandemic recovery in government salaries did not begin until much later in 2021, as most government education institutions “We maintained a remote-only system with minimal staff throughout 2020.” Government Employment Report.
