What you take home depends on what you bring in.
Employment statistics for February are as follows: economical rorschach test. What you see in the ink blot released by the Department of Labor depends largely on what you were already trying to see.
Nonfarm payrolls rose by 275,000 in February, easily beating consensus expectations and beating even the most bullish forecasts. However, last month’s revisions reduced the number of employees by 167,000, reducing the number of employees in January from the originally announced 353,000. Solid but does not cause burns 229,000, up from 333,000 in December to a still strong 290,000.
Unemployment rate rose to 3.9%; Labor market softens slightly From the household budget survey. Average hourly wages increased by 0.1%, lower than the expected 0.3% increase, and the growth rate for the previous month was revised down one notch to 0.5% from 0.6%, but this is also a sign of softening.
on the other hand, Weekly working hours have increased February’s figure was revised upward by a tenth of an hour to 34.3, and January’s figure was revised upward by a tenth of an hour to 34.2. This was better than expected and suggests that the January decline, which some saw as a sign of weakness, was more likely. Weather-related noise.
Those who tend to believe that the economy is resilient and that the labor market remains tight will probably notice the situation in February. Job creation and weekly working hours The most compelling part of the story. If you tend to see the labor market beginning to strain under the pressure of restrictive financial policies, you’re probably paying attention to the following: Rising unemployment rate and slowing wage growth rate.
What to expect if revisions are anticipated
One common approach to revisions is to tally up where employment would be if the numbers were as expected without the revisions and compare them to the revised numbers plus the new numbers. In this case, his unadjusted December and his January numbers plus his February estimate of 200,000. It was supposed to add 886,000 jobs in three months.average monthly profit of 295,333.
Combining the revised figures with the actual February growth, it means that 795,000 jobs were added in the past three months. This will add an average of approximately 265,000 jobs per month. So, the February employment report will look like this: The actual number was 91,000 lower than expected..
The problem is that Wall Street expected the January and December numbers to remain unchanged. Quite the opposite. Many analysts had expected more significant revisions to the numbers, especially in January. In terms of expected revisions, February numbers are probably still stronger than expected.
Furthermore, given the frequency of large revisions in recent reports, many analysts expect February’s numbers to also be revised. The expected direction of revision is determined by another inkblot test. If you’re inclined to think the economy is weaker than the official numbers suggest, you’d expect a downward revision similar to the one we got on Friday. If we believe the economy is still growing strongly, we would expect an upward revision similar to a month ago.
composition book
Reading job counts is complicated by job configuration. The services sector added 204,000 jobs, including 91,000 jobs in education and health. These are areas that many politically conservative readers view as: “Adjacent to the government” This is not evidence of the strength of the business cycle in the job market. Government salaries increased by 52,000 people.
Subtracting government and government-adjacent jobs, the job growth is 132,000. This is much lower than 275,000, but still a strong number. Moreover, construction 23,000 jobs added in February; Strong cyclical demand for labor.
In other words, February’s employment mix presents yet another Rorschach test. What you take home depends on what you brought with you.
In terms of what this means for the Fed, perhaps the safest interpretation of the February jobs report is to view it as a so-called “next thing.” blackjack push. Neither the dovish nor the hawkish theories won this move. Attention then turns to next week’s inflation report.
