Jobs Report Misses Big

Estimates

• Nonfarm Payrolls 180k; range 100k to 267k (87 estimates)
• Private Payrolls 170k; range 125k to 270k (42 estimates)
• Manu Payrolls 17k; range -5k to 32k (22 estimates)
• Unemploy Rate 4.7%; range 4.6% to 4.8% (82 estimates)
• Hourly Earn 0.2% m/m; range 0.1% to 0.4% (63 estimates)
• Hourly Earn 2.7% y/y; range 2.6% to 2.8% (25 estimates)
• Avg. Weekly Hours 34.4; range 34.3 to 34.5 (35 estimates)

Color

• “The March jobs report will provide two critical signals: First, the magnitude of the payroll gain will indicate whether hiring momentum is indeed increasing, or whether the February upside surprise was an anomaly, potentially related to mild weather conditions early in the year. Second, the aggregate income trend will be scrutinized in order to determine if consumer spending is in jeopardy following an inordinately weak start to the quarter”: Bloomberg Intelligence
• In February, the economy added 235,000 non-farm jobs, led by the largest increase in construction employment in almost a decade

Actual

• U.S. MARCH PAYROLLS RISE 98,000, JOBLESS RATE FALLS TO 4.5%
• Nonfarm payrolls forecast est. 180k, range 100k-267k from 87 economists surveyed
  • Nonfarm payrolls, net revisions, subtracted 38k from prior two months
  • Participation rate 63% vs prior 63%
  • Avg. hourly earnings 0.2% m/m, est. 0.2%, prior 0.3%
  • • Y/y 2.7%, prior 2.8% est. 2.7%
  • Nonfarm private payrolls rose 89k vs prior 221k; est. 170k, range 125k-270k from 42 economists surveyed
  • Manufacturing payrolls rose 11k after rising 26k in the prior month; economists estimated 17k, range -5k to 32k from 22 economists surveyed
  • Unemployment rate 4.5% vs prior 4.7%; est. 4.7%, range 4.6%-4.8% from 82 economists surveyed
  • Underemployment rate 8.9% vs prior 9.2%
  • Change in household employment 472k vs prior 447k

Knee-jerk