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March Payroll Report Out: 308,000 New Jobs Added
Yea, I probably should have put just put it in the state of the US economy thread, but I'm not updating that until monday and econ stats like this always excite me  .
Initial reactions: It's good news but it was long overdue and it needs to be consistent performance over the next several months. This sucks for Kerry though of which I'm slightly disappointed.
U.S. job growth soars
Gain of 308,000 jobs far better than Wall Street's forecasts; unemployment rate up to 5.7 percent.
April 2, 2004: 9:42 AM EST
By Mark Gongloff, CNN/Money senior writer
NEW YORK (CNN/Money) - U.S. payrolls grew at the fastest pace in nearly four years in March, the government said Friday, in a report that soared past Wall Street's expectations and could play a pivotal role in Fed policy and the presidential election.
Though economists cautioned that one month does not a trend make, it was possibly the best economic news since the onset of the last recession in 2001 -- a sign of spring for the nation's labor market, which has been mired in its longest slump since 1939.
Payrolls outside the farm sector grew by 308,000 jobs in March, the Labor Department reported, compared with a revised gain of 46,000 in February. The unemployment rate rose to 5.7 from 5.6 percent.
Economists, on average, had expected 123,000 new jobs and unemployment at 5.6 percent, according to Briefing.com.
It was the strongest gain in payrolls since a matching gain of 308,000 in April 2000.
While it would seem odd that the unemployment rate rose despite a jump in payrolls, the two numbers are generated by separate surveys. The unemployment rate comes from a survey of households, which found that 179,000 people entered the labor force in March. Employment in that survey actually fell by 3,000 jobs, resulting in a higher unemployment rate.
Still, most economists believe the survey of businesses, which is much broader, is a more accurate measure of the health of the labor market.
The surprisingly strong number should ease some of the political pressure on President Bush, who has been sharply criticized by Democrats for presiding over a net job loss so far in his administration.
It could also raise speculation that the Federal Reserve is closer than ever to raising its target for the fed funds rate, an overnight bank lending rate it manipulates to steer the economy.
Despite some signs of incipient inflation, most economists have believed that the Fed was waiting for a string of strong payrolls reports to raise rates, and Friday's report could be the first in that string.
"This definitely sets the Fed on the track for the hike they've been talking about for several months," Bill Cheney, chief economist at John Hancock Financial Services, told CNNfn. "But the Fed does require that there be a sustained trend -- it requires more months like this -- not necessarily at 300,000, but at 200,000 or better."
On Wall Street, stock futures jumped, and prices plunged in the bond market, pushing the yield on the 10-year Treasury as high as 4.15 percent, the highest since February. Bond prices and yields move in opposite directions.
The report comes after months of weakness in the jobs market and could be the boost that the Bush administration has been waiting for.
In its report, the department said service industries such as education and health care added 230,000 jobs in March. Part of the jump in services was due to the end of the grocery workers' strike in California, which brought thousands of workers back onto payrolls, but the Labor Department offered no details about the impact.
Goods-producing industries added 78,000 jobs, including 71,000 new construction jobs. Construction payrolls were actually cut in February, due mainly to bad weather. Weather in March, on the other hand, was unusually dry and mild in much of the country.
Manufacturing payrolls were unchanged, after 43 months of declines. Economists had hoped this would finally be the month factories added to payrolls, based on surveys of factory operators showing a greater inclination to hire.
Average hourly wages rose 2 cents, or 0.1 percent, to $15.54. But average weekly earnings slipped 88 cents, or 0.2 percent, to $523.70.
Wage growth is crucial for consumer spending, which fuels two-thirds of the economy. Hourly wages have grown just 1.8 percent in the past year, near the lowest level since 1986.
The average workweek also shrank by 0.1 hours to 33.7 hours, while the manufacturing workweek fell by 0.1 hours to 40.9 hours. Economists watch the length of the workweek as a leading indicator of employment.
Another leading indicator, temporary help payrolls, fell by about 2,000 jobs, only the second such decline in the past 11 months. Employers often hire temps before making more permanent hires, but some economists have worried that firms have lately used temps as a way to avoid paying health and other benefits.
http://money.cnn.com/2004/04/02/new...dex.htm?cnn=yes
Edit: oops neophono beat me to it.
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