The labor market has remained solid a year after the Federal Reserve began aggressively raising interest rates to tame high inflation. Employers added jobs last month in leisure and hospitality, government, professional and business services and health care. They cut jobs in construction, manufacturing and retail, the Labor Department said Friday.

The labor force grew in March, helping take pressure off of wage growth. Average hourly earnings rose 4.2% last month from a year earlier, an easing from recent months.

Job gains at many services businesses are helping offset cuts at large companies in industries such as technology, finance and entertainment. Zoom Video Communications Inc. is laying off 1,300 employees, or 15% of its staff. Goldman Sachs Group Inc. plans to cut 3,200 jobs. Walt Disney Co. began laying off workers in late March.

Weekly jobless claims, a proxy for layoffs, have risen from historic lows and job openings have declined, in signs of easing demand for workers as the labor market gradually cools.

“The great labor market machine is finally slowing down some, but it’s still got a lot of strength left,” said Robert Frick, corporate economist at Navy Federal Credit Union.

Any impact from the failure of Silicon Valley Bank and subsequent financial turmoil won’t likely show up in March’s jobs data, which reflects hiring trends earlier in the month. Still, the banking stresses could trigger a further cooling in the job market in future months. 

Small businesses and consumers might find it harder to get loans, which could ultimately result in layoffs. Workers, meanwhile, could be more hesitant to search for new jobs.

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