March Jobs Report

This morning, despite the stock market being closed, the Bureau of Labor Statistics released the jobs report for March.

The average in surveys of economists was for a gain of about 209,000 non-farm jobs, but the actual report came in at 120,000 jobs (seasonally adjusted data.)

There were job gains in many sectors, including manufacturing, finance, restaurants, and health care, with the notable exception of retail which lost more than 30,000 jobs in the month.

While the unemployment rate dropped to 8.2 percent, it was primarily because people dropped out of the work force (we typically need over 125,000 jobs in a month just to keep up with population growth.) The participation rate fell by 0.1 percent.

In other words, the unemployment rate fell only because the labor force fell by as much (164,000) as the population grew (169,000).

The total number of employed people fell and the number of people not in the labor force spiked up.

On the other hand, the total number of unemployed fell in the month, and the so-called U-6 unemployment rate which measures unemployed and underemployed fell dramatically -- for which my best guess as to an explanation is that people went from looking for work to not looking for work. If someone is not looking for work, they do not count as unemployed.

Furthermore, college graduates who have not been able to find their first job also do not count as unemployed in this data.

This jobs report is so far below estimates that I would not be surprised to see it revised upwards later. In the meantime, the stock market will be looking at some rough sledding when it opens on Monday.

The Obama Administration will trumpet the 0.1 percent downtick in the unemployment rate while Republicans will talk about the low number of actual jobs created, and the high actual number of unemployed people in the US.

The real story remains that this is the worst recovery since the Great Depression. Given that recoveries usually roughly mirror the recession that preceded them; this is true outside the US as well as in our history.

President Obama's policies are a wet blanket smothering entrepreneurialism in this country. James Pethokoukis addresses this in a worth-reading article for the NY Post, and Ed Lazear's article for the Wall Street Journal explains the Obama non-recovery quite well.

For economists to be looking for a GDP growth rate under 3 percent for 2012 is a disaster at this point in what should be a strong recovery following a serious recession. Whether it is Obamacare, tax uncertainty, or new EPA regulations, everything this administration does is anti-growth and anti-business.

What is remarkable is not that our economic statistics remain so weak at this point during the business cycle but that they are not weaker. For this we have to thank the American entrepreneurial spirit which is stronger even than the most anti-free market administration this nation has seen since FDR, or perhaps ever.

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