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The U.S. jobs added NFP +196k jobs in March, higher than 177k expected and 33k in February. Unemployment stayed at 3.8% 48 year low. Participation rate fell to 63.0 from 63.2%. Wages were less than expected with Avg hourly earnings +0.1% m/m v +0.3% exp, +3.2% y/y v +3.4%.

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March 2019 U.S. Employment Report

Despite the Fed having raised rates three months ago, market chaos and the government shutdown and the resultant uncertainty with Federal Reserve President Powell's seem unsure of the path for wages. In October American wages hit their highest levels in a decade at 3.1%, this trend continued as expected through March. 

The market expected the March report released Friday to see nonfarm payrolls rise in line with longer-run trends in monthly employment growth at a consensus of 177,000 new jobs. Logic suggested a return to the mean after the volatility in the hiring data. The wages data gives us indications of the FOMC plans on rates into 2019 and 2020. Unemployment is at a 48 year low on higher with higher participation and the two month NFP revision was +14,000 change to jobs last month.  

US Jobs Mar 2019 

Employment:

  • Non-farm payrolls  +196k vs +177K expected, Prior 20K (revised from 33K)
  • Unemployment rate  3.8% vs 3.8% expected/prior
  • Participation rate  63.0% vs 63.2% expected.prior (highest since 2014)
  • Underemployment rate 7.3% vs 7.3 % prior
  • Two month net revision +14K prior
  • Manufacturing payrolls -6k vs +10k (First loss since Oct 2016)
  • Private payrolls +182k vs 177K expected

Wages:

    • Average hourly earnings  +0.1% m/m v +0.3% Expected
    • Average hourly earnings 3.4% y/y vs 3.4% exp, Prior 3.4% y/y

 

 US Jobs Mar 2019 Earnings by Industry

Household Survey Data

 

The unemployment rate remained at 3.8 percent in March, and the number of unemployed persons was essentially unchanged at 6.2 million. 

Among the major worker groups, the unemployment rates for adult men (3.6 percent), adult women (3.3 percent), teenagers (12.8 percent), Whites (3.4 percent), Blacks (6.7 percent), Asians (3.1 percent), and Hispanics (4.7 percent) showed little or no change in March.

In March, the number of long-term unemployed (those jobless for 27 weeks or more) was essentially unchanged at 1.3 million and accounted for 21.1 percent of the unemployed. 

The labor force participation rate, at 63.0 percent, was little changed over the month and has shown little movement on net over the past 12 months. The employment-population ratio was 60.6 percent in March and has been either 60.6 percent or 60.7 percent since October 2018.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed at 4.5 million in March. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs. 

 In March, 1.4 million persons were marginally attached to the labor force, little different from a year earlier. (Data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 412,000 discouraged workers in March, about unchanged from a year earlier. (Data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 944,000 persons marginally attached to the labor force in March had not searched for work for reasons such as school attendance or family responsibilities. 

US Jobs Mar 2019 Industry

Establishment Survey Data

Total nonfarm payroll employment increased by 196,000 in March, with notable gains in health care and in professional and technical services. Employment growth averaged 180,000 per month in the first quarter of 2019, compared with 223,000 per month in 2018.

Health care added 49,000 jobs in March and 398,000 over the past 12 months. Over the month, employment increased in ambulatory health care services (+27,000), hospitals (+14,000), and nursing and residential care facilities (+9,000). Employment in professional and technical services grew by 34,000 in March and 311,000 over the past 12 months. In March, computer systems design and related services added 12,000 jobs. Employment continued to trend up in architectural and engineering services (+6,000) and in management and technical consulting services (+6,000).

In March, employment in food services and drinking places continued its upward trend (+27,000), in line with its average monthly gain over the prior 12 months. Employment in construction showed little change in March (+16,000) but has increased by 246,000 over the past 12 months. Manufacturing employment changed little for the second month in a row (-6,000 in March, following +1,000 in February). In the 12 months prior to February, manufacturing had added an average of 22,000  jobs per month. Within the industry, employment in motor vehicles and parts declined in March (-6,000). Employment in other major industries, including mining, wholesale trade, retail trade, transportation and warehousing, information, financial activities, and government, showed little change over the month.

The average workweek for all employees on private nonfarm payrolls increased by 0.1 hour to 34.5 hours in March, offsetting a decline of 0.1 hour in February. In manufacturing, the average workweek was unchanged in March at 40.7 hours, while overtime decreased by 0.1 hour to 3.4 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls rose by 0.1 hour to 33.7 hours. (See tables B-2 and B-7.)

In March, average hourly earnings for all employees on private nonfarm payrolls rose by 4 cents to $27.70, following a 10-cent gain in February. Over the past 12 months, average hourly earnings have increased by 3.2 percent. Average hourly earnings of private-sector production and nonsupervisory employees increased by 6 cents to $23.24 in March.

The change in total nonfarm payroll employment for January was revised up from +311,000 to +312,000, and the change for February was revised up from +20,000 to +33,000. With these revisions, employment gains in January and February combined were 14,000 more than previously reported. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.) After revisions, job gains have averaged 180,000 per month over the last 3 months.

The Employment Situation for April is scheduled to be released on Friday, May 3, 2019, at 8:30 a.m. (EDT).

Other US March Employment Component Releases

 

US March ADP Employment Report 

      • Employment +129K vs +175K expected
      • Prior +197K (revised up from 183K)
      • Expectations were from 125K to 240K
      • Smallest increase since Sept 2017
      • Goods producing -6K S
      • ervice producing +135K

ADP Apr 2019

US March Challenger job cuts

Released by Challenger, Gray, and Christmas Inc - 4 April 2019

      • US March Challenger job cuts +0.4% v +117.2% y/y prior
      • Layoffs 60.59k Prior 76.84k
      • First quarter cuts totaled 190,410, 10.3% higher than the 172,601 cuts announced in the final quarter of 2018 and 35.6% higher than the 140,379 announced in the same quarter last year.
      • It is the highest quarterly total since Q3 2015, when 205,759 cuts were announced.
      • It is also the highest first quarter total since 2009, when 562,510 cuts were recorded.
      • Job cuts continue to pick up as the total in Q1 amounted to 190,410 - the highest quarterly total since Q3 2015.

“Companies appear to be streamlining and updating their processes, and workforce reductions are increasingly becoming a part of these decisions. Consumer behavior and advances in technology are driving many of these cuts,” said Andrew Challenger, Vice President of Challenger, Gray & Christmas, Inc.

“Another major driver of the uptick in job cuts is economic uncertainty and fears of an upcoming downturn. Companies are reacting to market conditions as much as consumer demand,” he added. March job cuts were led by the Automotive sector, which announced 8,838 cuts. So far this year, automotive manufacturers and suppliers have cut 15,887 jobs. Energy companies followed with 8,149 planned cuts last month, for a total of 10,548 this year.

“Both Auto and Energy companies are pivoting in response to advances in technology and consumer demand for more efficiency. Companies in these sectors are attempting to attract talent who can compete with tech companies, like Apple and Tesla, which are beginning to compete in this space,” said Challenger.

The data provides information on the number of announced corporate layoffs by industry and region and acts as a general labour market indicator.

US Weekly Jobless Claims week ending March 30 2019

      • Initial jobless claims 202K vs 215K expected Prior 211K revised down to 212K
      • Continuing claims 1717K vs 1750K expected Prior 1755K
      • 4-week moving average 1,743,250, a decrease of 8,000 from unrevised 1,751,250 prior
      • Lowest level for initial claims since December 6, 1969 when it was 202,000

The largest increases in initial claims for the week ending March 23 were in Texas (+2,802), Arkansas (+821), Maryland (+330), Missouri (+324), and New Mexico (+160)

The largest decreases were in California (-1,296), Pennsylvania (-1,181), Oklahoma (-1,097), Wisconsin (-583), and Ohio (-468)

 

 

Source: AFP, TradersCommunity Data, BLS

From The TraderCommunity Research Desk

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