By Scott W. Winchell
The “sputtering economy” jobs numbers are out, and depending on who you get your analysis from, the general consensus on the release of the March jobs report by the Bureau of Labor Statistics is mixed at best, but once again, it is hard to see what they really mean unless we examine the underlying categories and trends.
The sputtering U.S. economy created just 126,000 jobs in March as bad weather, weak consumer spending and flailing corporate profits resulted in the worst report since December 2013.
Economists expected nonfarm payrolls to rise 245,000 in March, with the unemployment rate holding steady at 5.5 percent, according to Reuters.
February’s numbers were revised lower to 264,000 from the initially reported 295,000, while January’s number fell from 239,000 to 201,000. (CNBC)
But excuses are excuses when you want to soften the dismal picture. Read the report here from the Bureau of Labor Statistics from the U.S. Department of Labor.
Once again, blame the weather, or weak consumer spending. Of course the spending is weaker, more people are out of work than in, and that unfortunately includes low-paying jobs as if they were equal to career-related jobs if you listen to Obama and his famous talking points.
And about that weather excuse, again:
Overall Labor Participation Rate
After 74 months as President, where is America’s economy today in relation to gainful employment? Well, when you see that there are 93,175,000 Americans, 16 years and older, who are available for employment, and who are not working, the answer is not %$#(!? good!
That is the first time the number of Americans out of the labor force has exceeded 93 million. Also from February to March, the labor force participation rate dropped from 62.8 percent to 62.7 percent, matching a 37-year low.
Five times in the last twelve months, the participation rate has been as low as 62.8 percent; but March’s 62.7 percent, which matches the participation rate seen in September and December of 2014, is the lowest since February of 1978.
…Of the 156,906,000 who did participate in the labor force, 148,331,000 had a job and 8,575,000 did not have a job but actively sought one. The 8,575,000 are the unemployed. They equaled 5.5 percent of the labor force—or the unemployment rate of 5.5 percent (which matched the unemployment rate seen in February 2015). (Read more at CNS News.)
Women and Blacks Labor Participation Rates
Of that 93-plus million out of work, 56,131,000 of them were women, and 12,202,000 black people were also not in the labor force in March. So just who is responsible for the mess? Is this the “war on women” the Democrats and Obama always talk about?
According to data released Friday by the Bureau of Labor Statistics, 56,131,000 million women were not in the labor force last month, an increase of more than 100,000 from February when 56,023,000 women were not in the workforce.
The level is a record high, and the labor force participation for the month of March at 56.6 percent is a 27-year low, according to CNS News. In February that rate for women was 56.7 percent. (Read more at Breitbart.)
How about those race relations, with so many blacks far worse off now than 74 months ago?
In January of 2009, the black labor participation rate was 63.2% and now it is at 61%. Just before the economic disaster hit in late 2008, the black labor participation rate was 64.3% in August 2008. Draw your own conclusions on that one.
Remember, the unemployment rate falls when people are no longer included in the U-3 category the government uses as the official unemployment rate instead of the U-6. Look at the black youth numbers as well:
The unemployment rate for black people in March was 10.1 percent, which is nearly double the overall national unemployment rate of 5.5 percent. Last month, the unemployment rate for black people was 10.4 percent.
For black teens, age 16 to 19 years old, the unemployment rate was even higher at 25.0 percent, meaning that one in four black teens who were actively seeking a job did not have one. The participation rate for this group also declined 3.4 percentage points from 29.1 percent in February to 25.7 percent in March. (CNS News)
Low Paying Industries
Last month we saw that one dependable sector, the bars and restaurants, were responsible for one of the highest growth sectors, but this March, they took a dive. We jokingly reported last month that all people had time for was “drinking their blues away,” but now, maybe they cannot even afford to do that.
Tyler Durden at Zero Hedge reports::
Yesterday we warned that “the whisper expectation is for a NFP print that will be well below consensus, somewhere in the mid-100,000s if not worse now that the bartender hiring spree is over.” As already noted, we were spot on with the abysmal jobs print, the worst since 2013.
We were also correct about the end of the “bartender hiring spree” because as the following chart shows, the number of “Food Services and Drinking Places” workers, aka waiters and bartenders just saw its worst monthly increase since June of 2012.
Well, it will hardly come as a surprise, that four of the five most active job categories hiring in March were also the lowest paid:
Education and Health saw the addition of 38K worker
Retail Trade added 26K
Leisure and Hospitality added another 13K
Temp workers increased by 11K.
That leaves only 38,000 new jobs in all other sectors created in March and it really stinks in the mining and logging industries, construction, and the vaunted manufacturing sectors. (Both charts from Zero Hedge)
Revisions, Always those Dreaded Revised Numbers
As noted above from CNS News, the job gains in the months of January and February had to be substantially revised down. Once again, how are we supposed to believe any of the “rosy” numbers officially thrown at us when we see the dreaded revisions like those retractions on page B-16 in your paper after a fault was found in a headline story?
Over the past 3 months, job gains have averaged 197,000 per month, that is far below the numbers needed to propel economic growth, especially when they are predominantly low paying jobs or people are not earning to their potential.
Some economic recovery…74 months! (Chart from Zero Hedge)
Yes, job growth is occurring, but at this pace?
Market Reactions and Growth Predictions
A positive jobs report would have supported the recent “noise” coming from Janet Yellin at the Fed regarding interest rates but in the case of a negative report, “the Fed [is] more likely to cut rates than to increase them, and it reduces the odds of inflation.” A negative report is positive for the bond market. Well, we have negative, surprising negative for the experts.
Last week, Janet Yellin said; “…that the Fed planned to raise interest rates more slowly than in past recoveries because of the unusually fragile condition of the American economy.” Well Ms Yellin, here’s your fragile state.”
Zero Hedge puts it so: “Most importantly this ends any speculation about a rate hike in mid 2015, or ever for that matter, as virtually all Fed credibility is now lost.”
We tend to agree, after all, didn’t the “experts” expect a gain of 245,000 jobs in March? The experts, like Yellin, have other predictions:
Ms. Yellen’s speech was delivered hours after the Commerce Department reported, in its final revision, that the United States economy grew at a rate of 2.2 percent in the fourth quarter of 2014, down from a robust 5 percent pace during the summer months. Economists said that the economy probably slowed even further in the first quarter of this year, which ends on Tuesday. (Read more here at the NY Times.)
Meanwhile at the Atlanta Fed, the growth of the economy looks dismal:
In its most recently estimate, the Federal Reserve’s Atlanta branch is projecting the U.S. economy to show just a 0.1 percent growth rate in the first quarter. At the same time, corporate profits are expected to drop about 3 percent for the period and another 2 percent or so in the second quarter, according to S&P Capital IQ.
“We were due a clunker,” said John Canally, chief economic strategist at LPL Financial. “It’s probably the same things that are going to be impacting the earnings season in a couple weeks. It’s the strong dollar hitting manufacturing, the port strike hitting manufacturing, it’s the really awful weather…But across all sectors, it was just pretty soft.”
Markets reacted negatively to the report, sending stock market futures lower and government bond yields and the U.S. dollar tumbling. Stock and bond markets are closed in the U.S. to mark Good Friday. (CNBC)
More from the 247WallSt. web site backing up CNBC with more detail:
The Federal Reserve Bank of Atlanta has reported that its forecast for U.S. gross domestic product (GDP) growth dropped to zero on April 1 and ticked back up to 0.1% on April 2. The bank uses a unique model called GDPNow to prepare its forecasts, and the model typically estimates growth well below the rate projected by the Bureau of Economic Analysis (BEA). (Read more here at 247 Wall St.)
And this gem also from CNBC, “Futures sharply lower on jobs data miss,” a “clunker” indeed:
U.S. stock index futures plunged on Good Friday after the nonfarm payrolls came in far below expectations at 126,000.
“This jobs report might anticipate a sooner than later market correction,” said Peter Cardillo, chief market economist at Rockwell Global Capital. “The perception of bad news is not going to be interpreted as good news.”
The 10-year bond yield sank to 1.81 percent from 1.89 percent. The 2-year Treasury yield fell as low as 0.46 percent from 0.55 percent.
What do we conclude from all of this and 74 months of the Obama Administration running the economy? Must be Bush’s fault, or the weather, or Ferguson… Remember this gem: “It’s the economy stupid!” Our inept President and his “experts” and “czars” who never held real private sector jobs saving the day…
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