Jobs report: Which sectors saw the highest gains?

The March jobs report data was better than expected: 303,000 jobs were added, and the unemployment rate fell to 3.8%. Some of the sectors that saw the highest gains included healthcare, construction, and hospitality.

The leisure and hospitality sector added 49,000 jobs in March, returning to pre-pandemic February 2020 levels. Diving deeper into the numbers, restaurants and bars made up 28,300 of the leisure and hospitality sector gains, with hotels and lodging accounting for 3,200 jobs. Entertainment, museums, and other related industries also saw job gains within the sector as consumers continue to spend on experiences.

The construction sector gained 39,000 jobs in March. Non-residential construction jobs increased by 2,300, while residential construction jobs grew by 5,500. As this sector looks to hire more individuals, wages have seen a 5% increase over the past two years.

The healthcare sector added 72,000 jobs in March. Despite the ongoing staffing shortage the industry faces, the labor market is starting to slowly recover to pre-pandemic levels. Hospitals saw 28,000 workers added, while outpatient centers experienced 27,000 job gains.

Yahoo Finance Reporters Dani Romero, Anjalee Khemlani, and Brooke DiPalma break down the details.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

Editor's note: This article was written by Angel Smith

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SEANA SMITH: The US economy adding 303,000 jobs in the month of March. That was well above expectations of 214,000. Now, the sectors with the most job gains, well, they included health care, construction, and hospitality.

We've got team coverage for you to break down those hot sectors. Brooke DiPalma, Dani Romero, and Anjalee Khemlani are tracking the gains. Brooke, let's start with you and the jump that we saw last month in the hospitality industry.

BROOKE DIPALMA: Yeah. Good morning, Seana. Leisure and hospitality, certainly, was a driver of the March jobs report. Last month, leisure and hospitality sector added 49,000 jobs returning to pre-pandemic February 2020 levels. A big deal there for this sector.

Back in March-- back in February rather, that revised number was 43,000. And so last month, they added more jobs than what we saw back in February. Now, in particular, restaurant and bars added 28,300 jobs in the month of March. And accommodation, think hotels, think lodging, they added 3,200 jobs.

But across the sector, we did see jobs added across entertainment places, museums, amusement parks. And this really does prove consumer spending power that they have right now. Consumer sentiment-- really consumers continue to spend on vacations, dining out.

This experiential economy seems to be moving into 2024. And also, what we've heard from so many executives is that it is now easier to find employees. And this also speaks volumes to the wage growth that we've seen within the leisure and hospitality sector.

The average hourly earnings for leisure and hospitality employees, now, sits at $21.90. That is $1 more than where we were at last year. And we're also hearing from companies, like, Chipotle, that they're gearing up for this nicer weather. They added 19,000 jobs. Or they expected to add 19,000 jobs last month, both full-time and part-time for what they call burrito season, from March to May.

And so, certainly, wage growth and the addition of employees, when this nice weather comes out, will be something we'll be looking for in the next report. Dani, I know that you're keeping a closer eye on construction sector. What are you seeing there?

DANI ROMERO: Brooke, it was no surprise that construction gained 39,000 jobs in March. This is one of the sectors that continues to really show strong job growth.

Remember, this is an industry that is split into two categories. We have non-residential and residential construction jobs. So let's start with non-residential construction jobs. That gained 2,300 in March. And to give you some context here, non-residential construction spending has increased 24% in the last year.

So what does that mean? That means we're going to see really strong movement in this area. And we can't forget about the Bipartisan Infrastructure Act. There has also-- that will also trigger some more growth in this area and also for manufacturing, as the government still needs to allocate some more funding in these areas.

Moving over to residential construction, this is an area that has been a little bit more volatile. But gained 5,500 jobs in March. Some analysts do tell me that we could see some weakness in this area, especially, that housing starts in the third quarter of last year, actually, pulled back. So we could see some of those numbers trickle down further.

Finally, wages-- that has not slowed down for construction workers. Wages for these workers has increased over 5% in the last two years. At the end of the day, what does this mean? If you're a construction worker, and you're looking for a job, you're going to get hired. There's opportunity out there.

But let's switch over to health care. Anjalee Khemlani's watching there. What have you seen there?

ANJALEE KHEMLANI: That's right, Dani. Health care adding an astounding 71,000-- 72,000 jobs, sorry, this month. And that is still higher than last month by quite a stretch, in addition to being higher than the 12-month average of about 60,000 jobs per month.

And that's something that we continue to watch, because the industry is facing what we know is a physician shortage for the next decade, as well as looking at where the jobs are going. There is still a demand and supply issue in this industry and will be for some time.

We do see the numbers creeping back up above pre-pandemic levels. So, at least, a recovery from the loss of business during the pandemic has already been taken care of. If you take a look at where the jobs really came back, we've seen hospital, as well as outpatient centers really taking the lead there with 28,000 and 27,000 jobs added in those areas.

And that is where the patients are going. And that's something that the industry is really looking at is how to staff up in areas where patients are actually wanting to get care and need care. In addition, we also know the large aging population is contributing to the job growth. 18,000 jobs added there.

And those are the three sectors we continue to see consistent job growth month-over-month. Hospitals have been struggling with trying to fill. So while there are jobs added, it's important to note that there's even more jobs available and more demand for these positions on the regulatory limits as well as staffing ratios.

And a lot of different factors add into why hospitals can't necessarily staff up to where they need. So ongoing shortages despite this strong report is what's going on in the health sector.

BRAD SMITH: Yeah, Anjalee. You mentioned some of the industry trends that are driving demand for specific role or function types. That health care sector, red hot. How does that continue that sector? And why does it continue to add so many jobs each month?

ANJALEE KHEMLANI: Well, you know what's interesting, Brad, is actually these jobs are just of what's tracked. There's actually a large gap in what we don't know of where jobs are going in telehealth, or where they're going in corporate and startup. So there might be even more movement on that side of the scale. But that's not tracked in these reports.

So that's also where you see the movement happening. There's large physician burnout. There's a lot of nurse burnout as well. And nurses are, in fact, getting paid higher, because of the leaning on them for the work that is being left over, and they need to pick up on.

So there's a huge shift happening, a huge transformation happening in this industry. So you're going to definitely continue seeing this sector continue to be strong throughout the months.