March’s jobs report was a blockbuster and early reactions were almost unequivocally and universally upbeat.
“Everything comes up roses,” one headline declared.
“With more and more movement there is more and more demand, resulting in the need for more and more workers,” ING’s James Knightley said, adding that “given continuing upward moves in the daily restaurant and flight data through the second half of March, we should be looking at a jobs growth figure well in excess of 1 million in April.”
Services sector hiring was fairly robust. I say “fairly” because the March report actually showed a smaller gain for leisure and hospitality compared to February (figure below). I don’t want to make too much of that, but it’s at least worth a mention.
Note that the sector has just now recovered from the huge loss in December, when the winter COVID wave dealt a fresh blow to already beleaguered industries.
What about food service? That’s important. As regular readers are aware, I have a soft spot for bars despite being medically forbidden from consuming my beloved Balvenie ever again.
But even if I didn’t care personally for the economic fate of America’s bartenders and servers, note that restaurants and bars are a critical part of the economy no matter where you go. They’re crucial to the downtown ecosystems devastated by last year’s flight to the suburbs and they’re also critical in smaller cities and even in the tiniest of locales.
Food services and drinking places added 176,000 jobs in March, on top of an upwardly revised 309,000 in February. The total for 2021 is now more than a half-million (figure above).
Checking the usual “structural damage” indicators, the March report showed the percentage of total unemployed jobless for 27 weeks or longer rose again. It hit 43.4% in March’s report, up from 41.5% the previous month (figure below).
The number of job losses counted as “permanent” fell marginally, but the total is still more than two million higher than it was 13 months ago.
Specifically, there are more than 3.4 million Americans in the “permanent” category. That series remains extraordinarily elevated (figure below).
Finally, you might recall that last month, the gap between African American unemployment and white unemployment rose pretty sharply. That was a testament to the urgency of the Fed’s efforts to help foster a more inclusive labor market.
Fast forward to March and the gap narrowed, albeit only slightly (figure below).
One could, of course, parse March’s report further. There are a theoretically endless number of charts and conclusions to draw.
Ultimately, though, the “all roses” characterization is probably a semblance of accurate, although the Biden administration will invariably say there’s much more work to be done.
And, as you can see from many of the visuals above, they’ll be correct in that assertion.