normally a big increase in new us jobs is cause for celebration not right now the federal reserve sees a tight labor market as a big obstacle in getting high inflation under control and wants hiring to slow as soon as possible but it might not get its wish in march here’s what to watch in the us employment report due on friday morning the economy is expected to add 238000 jobs in march according to economists polled by the wall street journal the us created an estimated 311000 jobs in february and 504000 in january both easily surpassed expectations and induced more worries at the fed a 200000plus increase in march would still be quite strong the us added an average of 173000 new jobs a month in the year before the onset of the pandemic in 2020 senior federal reserve officials say the labor market is too tight and needs to loosen up how come they worry rapidly rising wages tied to the labor shortage will make it harder to get inflation under control the fed would like to see hiring drop well under 200000 new jobs a month accompanied by much smaller pay increases yet another big jobs gain would put pressure on the fed to interest raise rates more than they planned senior officials have indicated they only plan to lift rates one more time this year based on their latest assessment of the economy the percentage of jobless americans seeking work rose to 36 in february just a few ticks above a 54year low wall street expects the unemployment rate to hold steady in march the fed expects the rate to climb to as high as 45 in the next year as rising interest rates depress economic growth some wall street economists predict even worse unemployment on the assumption that a recession is likely average hourly wages are forecast to rise 03 in march such a relatively modest gain would knock down the increase over the past year to 43 from 46 that’s still too high for the fed however the central bank wants to see wage growth return to levels consistent with low inflation seen as 2 to 3 a year the government’s process of adjusting the jobs report for seasonal swings in employment may have inflated hiring gains in first two months of the year unseasonably warm weather may also have contributed it’s possible there could be payback in march economists say that results in a much weaker employment increase than wall street expects “recent labor market evidence along with our conversations with business executives indicate that hiring efforts have been scaled back notably across numerous sectors” said chief economist gregory daco of ey parthenon