Friday, March 08, 2013

Jobs, Jobs, Jobs...

I was privately predicting that the jobs number would come in around 187k jobs and the February number blew that away.  However, if you back out the revisions to January (-38k) you get a number pretty close to my estimate -

February: +236k
January: -38k

Net: +198k.

The household survey (where we get the "unemployment rate) saw the total # of "unemployed" 300k but according to the survey 170k of those were newly employed while 130k dropped out of the workforce.  Depending upon your political affiliation you may see this as a natural shift in our country's demographics or a manipulation of data as workers drop out of the workforce.

Participation remains at historic lows but I expect it to stay there for many years because we've become an aging culture but that's a topic for another day.

The stock market's reaction has been fairly muted (but it's begun a steady climb and will obviously be ANOTHER RECORD DAY), but the reaction in other markets (debt, currencies) has been more substantial.  Remember, I believe that without the Federal Reserve (and other central banks) flooding the markets with liquidity I'd expect stocks to be 25-30% lower.  If the economy has turned a corner and the Fed started to pull back it could lead to a negative reaction in stocks despite positive economic data.

The composition of the jobs created remains poor - mostly part-time positions, more staffing positions, retail, restaurant and surprisingly construction.  I say surprisingly re: construction jobs because we had a blizzard in the Northeast and permits were down in February.  I believe the construction jobs may be in multi-family but I can't confirm that.

It's interesting to note that with three years of jobs improvements we've now reached the same point which was the absolute BOTTOM of the 2001 recession.  That gives you a little perspective on the scope of the 2008 recession.

Overall, it's a decent report (interesting Jan/Feb 2012 were stronger than Jan/Feb 2013) but we're still plodding along.

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