The nation's civilian unemployment rate dropped 0.1 percent to a seasonally adjusted 10.3 percent in March as employment climbed back to its January level and the overall size of the labor force fell slightly, the Labor Department reported yesterday.
Details of the report indicate a modest improvement in the employment situation over the last three months, but the big decline in the unemployment rate from December's 10.8 percent level is due entirely to an unexplained contraction in the size of the labor force rather than to the economic recovery.
Even though the civilian population grew by 457,000 persons between December and March, the number of people employed or looking for work fell by 645,000, the department said.
If the same proportion of the population had been in the labor force last month as in November and December, and employment was no higher than the level actually reported for March, the civilian unemployment rate last month would have been 11.1 percent rather than 10.3 percent.
Adding to the mystery of the labor force shrinkage was the fact that the bulk of the vanished workers were adult males whose ties to the labor force normally are quite stable. The labor force participation rates for adult women and teen-agers are also down.
Nor did any of the workers show up in the ranks of those who have stopped looking for a job because they think none is available. The number of so-called discouraged workers, which is checked only every three months, fell from 1.85 million in the fourth quarter of 1982 to 1.76 million in the first quarter of this year.
Janet L. Norwood, commissioner of labor statistics, said "these recent developments in the labor force are especially difficult to interpret."
Jerry Jasinowski, chief economist of the National Association of Manufacturers, said he expects employment to increase gradually as the economic recovery proceeds this year. But he added, "I continue to believe unemployment will rise in the months ahead unless the recovery picks up more steam."
Other analysts warned that an abrupt jump in the size of the labor force could push the reported unemployment rate upwards by as much as 0.4 or 0.5 percentage point in a single month.
If the 1.7 million persons in the armed services are included in the labor force and the number of employed workers, the overall unemployment rate last month was 10.1 percent, down from 10.2 percent in February and 10.7 percent in December.
According to the monthly survey , civilian employment rose by 40,000 last month to a level of 99.10 million. With an accompanying drop of 69,000 in the labor force, the number of unemployed workers fell by 109,000 to 11.38 million.
The unemployment rate for adult men dropped from 9.9 percent to 9.6 percent; the rate for adult women dropped from 8.9 percent to 8.8 percent. The rate for teen-agers rose from 22.2 percent to 23.5 percent.
Unemployment among blacks rose from 19.7 percent in February to 19.9 percent in March, while the rate for whites fell from 9.2 percent to 9 percent. Unemployment among workers of Hispanic origin increased 0.4 percentage point to 16.2 percent.
A separate monthly survey of payrolls showed an increase in employment of 119,000 to a level of 88.85 million, with virtually all of the gain occurring in service-producing industries. Manufacturing employment rose by 39,000 to 18.26 million.
The department also reported that the index of aggregate weekly hours worked by production and nonsupervisory employes rose 1.4 percent. However, the index remained below its January level when unusually mild weather in many parts of the country helped boost employment in construction and some other industries.
The index for manufacturing alone rose 1.8 percent, suggesting that industrial production increased modestly in March, analysts said.
Norwood told the Joint Economic Committee the report showed "the employment situation improved moderately in March. . . . Especially important is the fact that factory employment, which has been hard hit by the recession, has had small but persistent gains since December."
The unemployment rate for manufacturing workers dropped from 14.8 percent in December to 12.8 percent last month, and the number of persons on layoff fell from 2.5 million to 1.9 million, Norwood said.
Another measure of the improvement is the 226,000 decline from December to March in the number of persons working part time who usually work full time. Last month there were 1.93 million workers in that category.
The reduction in layoffs has contributed to the decline in the number of unemployed workers who have been jobless for 5 weeks or less from about 4 million to 3.44 million over the last three months. graphics/photo: BLS Commissioner Janet Norwood says unemployment had "improved moderately." UPI