Time for the least interesting jobs report ever, as we learn about where the economy was in early February -- basically before the United States started responding in any vigorous way to coronavirus.
So this report really is staring in the rearview mirror.
So this report really is staring in the rearview mirror.
But the good news -- the really darn good news -- is that between early Jan and early Feb the economy created 273k nonfarm payroll jobs. Unemployment fell a tick to 3.5%. And revisions for the past two months added another +85k.
In any normal month, we would be calling this a yabba dabba doo! jobs report. Evidence of a strong -- and perhaps even strengthening -- labor market. As strong as we've seen it in generations. Enough that the Fed might be looking to raise rates to prevent overheating.
The pace of jobs growth over the past three months really is something: +184k in Dec, +273k in Jan, and +273k (again) in Feb, for a 3-month average rate of +243k.
Data are noisy, etc, but that's strong enough to suggest that the economy was really surging over recent months.
Data are noisy, etc, but that's strong enough to suggest that the economy was really surging over recent months.
There's also a hint of some wage growth, with hourly earnings rising by 0.5% in the month, and up 3% over the year. Still not rapid enough to threaten the Fed's inflation target, but a hint of emerging bottlenecks (hold my beer, says China).
Here's a measure of how little the economy's performance in February matters to the outlook:
It's stunning to think that with unemployment at 3.5%, and job growth averaging around 240k, that the Fed would be lowering rates to near historic lows. But that's the crazy contradictions in today's economy.
Can't help but noting that employment in paper and paper products fell 700 in February. That'll reverse next month. 🧻🧻🧻
What do we learn from today's jobs report?
That the economy had serious momentum heading into the post-Coronavirus period. And while that doesn't tell us much about what will happen over the next few months, it's much better than the alternative of starting from a bad place.
That the economy had serious momentum heading into the post-Coronavirus period. And while that doesn't tell us much about what will happen over the next few months, it's much better than the alternative of starting from a bad place.
If you want something more like a real-time indicator of the labor market, it'll be worth tracking initial unemployment claims closely over the next few weeks.
That gave no indication of bad news for the week ending February 29 (which seems forever ago).
That gave no indication of bad news for the week ending February 29 (which seems forever ago).
