Long Island’s unemployment rate fell to 4 percent last month from 4.2 percent in March 2016, state data released Tuesday show.

The Island’s march toward “full employment” — the classic economic measurement is a jobless rate below 4 percent — coupled with a possibly rising number of retirees, shrank the labor force here. The number of unemployed and employed residents fell by 13,100 last month to 1.46 million residents, the state Labor Department said.

“The decline in the labor force was most likely led by increasing retirements in our region, which has an older-than-average population,” said Shital Patel, labor-market analyst in the department’s Hicksville office.

The number of unemployed residents declined by 4,100 to 58,600, the lowest for the month since 2007. And the number of employed residents fell by 8,900 to 1.41 million.

John A. Rizzo, chief economist for the Long Island Association trade group and a Stony Brook University professor, said that the employment data show “a pattern consistent with a labor market that is approaching full employment levels.”

The local labor market is “clearly tightening” and that may mean that, as in the national employment market, wages are rising here, said economist Gregory DeFreitas, who heads Hofstra University’s labor studies program.

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However, a low jobless rate is a double-edged sword, Patel said.

“While a low unemployment rate is generally good news for the region, as the economy reaches full employment, skills shortages will become more of an issue,” she said. Competition for skilled employees becomes more intense.

The declines in the latest report come after a separate Labor Department report last week showed that local job growth slowed in March. Employment grew at an annual rate of 19,800 jobs last month, down from 29,500 in February and 28,300 in January.

The department uses year-over-year comparisons because local data aren’t adjusted to account for seasonal fluctuations in employment.

On Long Island, Hempstead Village and Southampton Town had the highest jobless rate, 5.9 percent. Southampton’s high rate is generally considered to reflect seasonal factors. North Hempstead Town, Oyster Bay Town and Rockville Centre and Smithtown, all had the lowest — 3.4 percent.

Around the state, Nassau’s 3.7 percent ranked it second, behind New York and Queens counties’ 3.6 percent. Suffolk, at 4.3 percent, came in eighth. The state’s rate was 4.4 percent and the nation’s 4.6 percent in March, on the same unadjusted basis.