NFP Release:

Nonfarm payroll employment increased by 162,000 in March, and the unemployment
rate held at 9.7 percent, the U.S. Bureau of Labor Statistics reported today. Temporary help services and health care continued to add jobs over the month. Employment in federal government also rose, reflecting the hiring of temporary workers for Census 2010. Employment continued to decline in financial activities and in information.

Let’s break down the highlights into the good and bad:

Negatives
• Average Hourly Earnings of all employees NFP fell by 2 cents, or 0.1%.
• Unemployment rate is unchanged at 9.7% (no improvement this month)
U6 Unemployment, the broadest measure, rose to 16.9% –that’s off of the December 2009 peak of 17.3, but higher than January (16.5%) and February (16.8%) of 2010.
• Long-term unemployed (jobless for 27 weeks+) increased by 414,000 to 6.5 million. (bad)
• 44.1 percent of unemployed persons were jobless for 27 weeks +. (Also very bad)
• Involuntary part-time workers increased to 9.1 million in March. (This remains a stubborn problem area)

Positives
• +162k is the best report since March, 2007.
• Average workweek was up by 0.1 hour to 34.0 hours in March.
• Temp help services added 40,000 jobs in March. That’s a cumulative add of 313k since September 2009.
• Census added “only” 48,000 workers — far below the 100-150k consensus. This pushes their hiring out into the rest of the year.
• Civilian Labor Force Participation Rate at 64.9% edged up in March
• Manufacturing continued to trend up (+17,000); Mfr added 45,000 jobs in Q1.
• Revisions: January 2010 data was revised upwards 40k (from-26k to +14k); February was revised up 22k (from -36k to -14k).

Category: Data Analysis, Employment

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

43 Responses to “NFP: +162k”

  1. b/d + 81k with 34k in Leisure and Hospitality.

    http://www.bls.gov/web/empsit/cesbd.htm

    Seems about right — there were about 4 employees for every customer in the hotel restaurant I ate at last night in Dallas :)

  2. beatstreet says:

    Bob Barberra with the first on-air orgasm on CNBC since Maria and the tech bubble.

  3. [...] News is Good News? The nonfarm payroll numbers are out.  162K jobs added in [...]

  4. VennData says:

    Everyone knows these numbers are fixed, the gov’t counts lesbian bondage performers as “employed” …and Southern California GOP party activists as both “looking for employment” and “looking at employees.”

    Legalize Tea!

  5. rktbrkr says:

    Don’t forget the weather influence !

    It will probably come as a surprise to most Americans, but the winter just finished was the fifth warmest on record, worldwide.

    Oh, sure, nearly two-thirds of the country can dispute that from personal experience of a colder-than-normal season.

    But while much of the United States was colder than usual, December-February – climatological winter – continued the long string of unusual warmth on a global basis.

    And parts of the United States did join in, with warmer-than-normal readings for the season in New England and the Pacific Northwest. Indeed, Maine had its third warmest winter on record, the National Oceanic and Atmospheric Administration reports.

    NOAA’s National Climatic Data Center reports that worldwide the average temperature for winter was 54.9 degrees Fahrenheit (12.7 Celsius).

    That’s 1.08 degrees F (0.60 C) above average for the three-month period.

  6. Mike in Nola says:

    More work for less $ ?

    Anecdotal evidence in Houston which may show next month, two people I know at Krogers had hours cut from 30+ to 14 and 16 this week. Seems odd, considering it’s a holiday week which should have plenty of food buying. Also notice a greater reliance on self checkouts at the groceries and Walmart.

  7. [...] Ritholtz at The Big Picture blog breaks down the report into negatives and positives, finding a mixed picture, but still, this [...]

  8. CTX says:

    thanks for posting the poss and negs on the report. If more people would read your column I think we would begin to have a more balanced reading on the markets…El Erian had a tough time today on CNBC-.. I can see why some people/experts on the markets refuse to take part in the bubblevision networks

  9. torrie-amos says:

    texans hit the road during holidays mike, lotsa ghost towns around the state, i’ve watched it for 30 years

    agree more work less money, older workers getting squeezed

    one of these days the law of large numbers will catch up, govt hire and pay is getting out of whack with private

  10. Mike in Nola says:

    torrie: Houston a ghost town? Groceries look full to me.

    The OTOH on my previous post was that Home Depot and Lowe’s were doing good business in the garden depts. Got a cheap mower and a trimmer for our new rental house. Think I’m about the only guy in Houston cutting his own grass. Really hate leaf blowers – a sign of what is wrong with our culture; guys hired by lazy people wasting gas to do something that could probably be done quicker with a rake. BTW, the Lithium Ion powered Ryobi string trimmer is very nice for someone with light trimming needs.

    See that the Houston mayor is looking at more budget cuts. http://www.chron.com/disp/story.mpl/metropolitan/6940100.html
    She just raised <65 retirees health premiums by 50%. And Houston is probably better off than most. Think that will be the basis of the next leg down in employment as municipal and state employees get the axe. Many only kept their jobs because of stimulus money last year and that's running out. Don't think Big O can pay to keep them all employed.

  11. cognos says:

    Uh… love that you list the “negatives” first.

    Havent we gone from -700k on NFP a year ago… through flat the last 4 months… to +160k in March. I dont know much about trends and the business cycle… but where do you think that is in 3 months? maybe +350k? Howabout 6 months out? +500k?

    Also, nice work tucking the +60k revisions from Jan/Feb at the very bottom. Remember the sequence of post on all the negative revisions to data back in Nov/Dec? Course… it wasnt really true then. And now we dont talk about the positive revisions.

    Recovery will continue to dramatically outperform expecations. Q2 will be better than Q1 for both economics AND the stock market.

  12. Here’s your chance to talk about today’s jobs report with the people who compiled it. The Bureau of Labor Statistics is holding its first live webchat at 9:30 ET: http://www.bls.gov/chat/

  13. Mike in Nola says:

    ctx: see what you mean about El Erian. Sounds like he was being interviewed by cognos. They wouldn’t take no for an answer. Reminds me why I don’t watch.

  14. Rob King says:

    So if we take the 162K and subtract out the transient census hiring (48K) an the expected weather bump (50K), we get 64K for the NFP increase.

    Since population growth requires somewhere between 100K to 150K of jobs on a monthly basis, it’s highly likely that we’re still below the amount necessary to accommodate new entrants, much less at a point where we’re recovering jobs lost since the recession began. This doesn’t mean that we’re not bleeding out more slowly (it seems like we are), but I’m not sure it warrants the type of exuberance associate with proponents of a more bullish outlook (cognos, talking heads, etc.).

  15. riffraff says:

    Re: The Bureau of Labor Statistics is holding its first live webchat at 9:30 ET: http://www.bls.gov/chat/

    I reading a lot of questions about the B/D factoring. I don’t think anybody understands it.

    It is VERY instructive to go back and look at historical data for the B/D. Years 1999 and 2000 there was almost no use of it. Then, the BLS starting adding various job categories and the number really began to ramp:

    http://www.bls.gov/ces/cesbdhst.htm

  16. Mannwich says:

    We are Japan X 100. Get used to it. The new “normal” is upon us.

  17. Mannwich says:

    Was out last night. For cognos, first the POSITIVE:

    The outdoor bars/restaurants – completely mobbed. Tons of traffic in the “Uptown” neighborhood. Seems as if people are coming out of their caves to enjoy life a bit. (CAVEAT – it was still 78 degrees at 9 p.m. here last night in Minny. People are manic here at any hint of good weather after a long winter)

    And, here’s the negative:

    The indoor bars/restaurants – barely half full on a nice, warm Thursday night.

    So, there you go. Balanced enough for you? We are seeing signs of life in Minny but we are better off than most with a more balanced economy and many large corporations based or having a big presence here.

  18. Mannwich says:

    I think any “recovery”, if you can call it that, will be at best, spotty, but the market and commodity bubbles will roar onward making it seem like a real “recovery”. However, like the most recent “recovery” this one will be even weaker than the last and when this bubble bursts, the damage will be even worse as well. Great recovery.

  19. HarryWanger says:

    @cognos: Seriously, dude, it’s Barry’s blog. He can write in any manner he wishes. In YOUR blog, please feel free to list the positives first and the negatives following.

    And that gun that’s pointed at your head MAKING you read Barry’s blog, is all in your mind. You don’t have to read it. There are plenty of blogs out there that list the happy stuff first. You may want to run to them now and participate in their “positive aspects of the Employment Report listed first” orgy.

  20. Mannwich says:

    A little off-topic but I thought this post over at Naked Capitalism was very good about the apparently declining savings rate. Mr. Harrison thinks that “something unhealthy” is going on with all of the stimulus and that all it’s doing is increasing the savings rate for BUSINESSES, while individuals are still far too in debt. Ya think?

    http://www.nakedcapitalism.com/2010/04/why-the-fall-in-the-savings-rate-means-something.html

  21. HarryWanger says:

    Mannwich: Owning a business in Minneapolis and traveling there frequently, it’s insane how people flood anything outdoors on the first nice evening. That would happen, as you know, if 75% of the population didn’t have jobs. It sucks being stuck inside for months on end.

    Having returned from a week there on Monday, I was talking with associates here with what I found to be an overwhelming amount of conversations regarding how awful the economy is. It was strange to hear and it came up in nearly every situation and meeting. Depressing to say the least and very unexpected.

    It almost seems as if last March the world was ending and there was fear. Now it seems like the fear has become the realization that whatever recovery happens, life as most have known in the recent past, has changed. While it may not be getting worse, the reality has sunk in.

  22. Mannwich says:

    @Harry: Precisely what I’m seeing too. I think that to some extent people have kind of accepted the “new normal” and have just decided to go out and enjoy life in spite of it. After all, you can only stay holed up in the fetal position for so long. Regardless, life goes on and I think that people realize that.

    One dynamic that I’ve noticed being out and meeting new people recently at events and gatherings is that almost nobody asks you about your job and “what you do” anymore. It’s almost as if people don’t want that thrown back at them because their situation sucks and they don’t want to talk about it, or they’re afraid to ask you and bring you and the whole “vibe” down. Virtually nobody wants to talk about ithat topic and when they do, many I’ve talked to openly admit that their jobs/careers/companies really suck right now, even the ones that have jobs. I tend to pick up on little things like that, so I’m sure it’s not in my head. It’s real. The new normal is upon us. We all need to get used to it. The world’s not going to end, for sure, but it’s likely not going to be one of the better time periods for the country overall. Some (like cognos) will likely do just great and assume everything is “just great” because the “people they know” (kind of like the CNBC crowd) are doing “just great”, but those folks need to get a reality check.

  23. cognos says:

    “New normal” is dumb and wrong.

    GDP growth was >5% in Q4. It will be 3.5% in Q1 and 4.5% in Q2. How is that “new normal”?

    You guys are basically saying — “we are not in full boom, full post-crisis recovery”. Yeah, so? The SPX is not at 2,000 either. Duh!? Its at 1150… by the time things are “good” all around you and people feel “good”. The SPX will be at 1500. You’ll have missed the next leg of the move.

    Instead of trying to “explain away” the +150k payrolls… ask yourself, what’s the number next month? (+250k). Howabout the month after? (+350k) Etc.

    And so IF that happens… you might as well admit, it looks like a pretty good recovery.

  24. Mannwich says:

    The fake economy = in recovery/bubble (probably early stages)
    The real economy = not so much (GDP and other esoteric-sounding stats means squat to real people)

  25. Mannwich says:

    No “recovery” in Birmingham and other cities like it. The “new normal”, cognos, but not for you personally, so it doesn’t exist.

    http://www.rollingstone.com/politics/story/32906678/looting_main_street/print

  26. Mannwich says:

    Welfare for Wall Street. A shit sandwich for Main Street, as the average worker continues to get pummeled. Looks like a great “recovery” for the parasites on Wall Street. Most everyone else? Not so much. Mish continues his usual tirade against the evil Unions, which, in comparison to the MUCH bigger problem, is but a pimple on this country’s ass. But, hey, it’s a great way for the elite to get the Sheeple to war with each other over the remaining table scraps.

    http://globaleconomicanalysis.blogspot.com/2010/04/la-deputy-chief-of-staff-says-unions.html

  27. HarryWanger says:

    cognos said: “GDP growth was >5% in Q4. It will be 3.5% in Q1 and 4.5% in Q2. How is that “new normal”?”

    That’s awesome. I look forward to it. BTW: A lot of times people who post what they are experiencing in the economy is misinterpreted as “missing the run up”. Au contraire. I’ve done very well in this run up. In trading, follow the trend, plain and simple. The trend has been up. Period.

    But, in real life scenarios, discussions, meetings, etc. that I have had recently the picture isn’t very rosy. Maybe in your circle or line of work but not with the people I’ve been selling to and working with. There is a gloom that’s sort of set upon many with the realization that the good ol days of watching your home value run up double digits monthly, is not returning any time soon. They’re working harder and getting paid less.

    I’m glad you’re doing well and seeing such great signs of growth in the economy. I’m not going to argue that with you. But your world and the world of others in bad, sometimes very dire situations, are different. While you see growth, they see their home values dropping – still. They see another year go by without any wage adjustment for inflation. That’s their reality. I’ve seen it and it affects my business firsthand.

    And regarding payrolls. Until we consistently are able to add 300k plus to start to ever so slightly and slowly chip away at unemployment levels, then yes, it will look like a pretty good recovery. Actually it’ll look like a pretty awesome recovery. Hopefully, you’re right.

  28. willid3 says:

    we can only hope we don’t repeat the ‘recovery’ from 2001. but i have my doubts that it won’t be the same again

  29. Mannwich says:

    @willid3: That’s been my prediction. I think it’s more of the same but an even weaker “recovery”, especially jobs-wise and for Main Street. Wall Street and big corp execs, on the other hand, will do even BETTER in this “recovery” and income disparities will widen.

  30. Mannwich says:

    It’s all part of “script” to completely strip mine the middle class in the U.S of BananAmerica……..on the road to serfdom.

  31. Rob King says:

    @cognos, what leads you to believe that the numbers next month will be +250K and the numbers the month after that will be +350K? Or rather, to put it in different terms, why do you think anyone can predict what the numbers will be one month from now, much less two months from now?

    If you’ll remember, when the February NFP came out, people were expecting 300K for March. Then two weeks later, the number adjusted to 190K-200K. Then a day or two before today’s numbers, the adjustment went to 184K. Finally, the number rests today at 162K. (Subject to further revision in the future, no less.) So much for prediction.

    You’re right in saying that IF we get a month with +250K and a month after that with +350K and then six months from now (assuming 350K in the months inbetween) we get a month with +500K, that would be a really great recovery. Except, that’s a rather BIG if, right? I mean, if that happens, in six months, we’ll have recovered 2.15 million jobs. Incidentally, that would be equivalent to the yearly rate of private sector job additions in the 1990s in just six months! And that’s double the yearly rate from 2001-2007. (See this article – http://online.wsj.com/article/SB125470053662262957.html)

    I’m not saying it absolutely can’t happen, but… well, the odds probably aren’t so good.

  32. [...] Economy, Internet, Markets, Media, Technology, Unemployment, Washington – Barry Ritholtz breaks down the pros and cons of today’s jobs [...]

  33. cognos says:

    Rob King –

    The thing is… compared to a downturn +162k (and +60k in last 2 months revisions) is a hair off of +200k or +250k expectations right?

    If we do +200k, +250k, +300k… that basic profile is not THAT different from +250k, +350k, +450k. Slightly smaller magnitude on 1 measure which probably just give it more room to accelerate going forward. The US economy is like a battleship.

    The other basic point… is that those negative nellies dont say — “next NFP payroll number will be weaker”. They cant. It wouldnt even make sense to them. SO THEN, if we all agree its getting stronger each month, and that is likely to continue… that must be what a recovery looks like. Right?

    HarryWanger, et al -

    I bet MOST of the posters who are highly bearish are dramatically underinvested in this market. So while YOU might not be trading like your talking… most are. (In fact, most are simply talking about “new normal” and “double dip” and how “its all fed-liquidity induced” so that they feel better about the poor portfolio performance.)

    In hindsight… I want to be close to 100% correct on every trading decision. My hindsight traded portfolio does more than 100% per year in returns. I always find it funny / odd / unproductive when people want to “justify” bad decisions in markets. Its not helpful for learning, improving, etc.

  34. Rob King says:

    @cognos, you’re right that +162K and +60K would not be too far off +200K or +250K, but that’s not what was predicted. The prediction in February was +300K jobs added in March. Not +200K-ish jobs in March and +100K-ish jobs from revisions to the numbers from the last two months. (I really wish I could find a link to one of the articles from last month to show this, but I guess you’ll have to trust my memory on this one…) And then those predictions continually wound down until a few days before, and even then, the prediction was a little overly optimistic. (Though the 184K may be within the 5% margin of error — I’m not sure).

    Even if we do +200K, +250K, +300K, +350K, +400K, +450K, that’s 1.95 million jobs in six months. Again, that’s still incredibly close to the 2.15 million (yearly!) job growth in the 1990s, which is still roughly double the yearly job growth in the 2001-2007 span. I’d like to reiterate here that I’m not saying that type of job growth CAN’T be made in six months, but I’m not willing to give good odds on it.

    I think it’s very likely that NFP will be positive over the next few months (positive as in over zero, anyhow). I mean, can you imagine them being negative (negative as in under zero) given the possibility that the Census will add up to 700K jobs over the next few months? The reason I want to parse all this out though is that Census hiring is by definition transient. I wouldn’t want to hop on a train that says things are getting better really fast only to find out later that it was just the morphine (transient Census jobs) talking, you know?

    Anyhow, I don’t think very many people are saying that a recovery isn’t happening. I think the disagreement just happens to be with the RATE at which it’s happening. And consequently, whether the upward pricing movement of the market has priced in a more robust and quicker recovery than the economic indicators are bearing out.

  35. dead hobo says:

    BR noted:

    • Temp help services added 40,000 jobs in March. That’s a cumulative add of 313k since September 2009.
    • Census added “only” 48,000 workers — far below the 100-150k consensus. This pushes their hiring out into the rest of the year.

    reply:
    ———–
    Net change = -8000 temp help. Green shoots, baby. Give that cash to the commissioned investment pro! They must have gone perm over the last 30 days. S&P 1400 by end of year likely.

    BTW, I’m glad to see the B/D adjustment isn’t an issue any longer. Now that summer is approaching, a couple hundred thousand assumed lawn mowing careers and eBay opportunities should really bump up the B/D adjustment up per month.

  36. dead hobo says:

    Rob King Says:
    April 2nd, 2010 at 4:00 pm

    Anyhow, I don’t think very many people are saying that a recovery isn’t happening. I think the disagreement just happens to be with the RATE at which it’s happening.

    reply:
    ———–
    Yes, the boom is building. One of my relatives who I thought was showing a lack of enthusiasm over replacing some nice extended benefits with a real job proved me wrong. My relative is working. My relative has replaced a full time career in the professional level technical support area with a wonderful part time opportunity in retail. I feel it is sale to assume that employment is improving, retail is expanding, and hiring is positive. Woo woo woo.

  37. cognos says:

    RK -

    I think your wrong on a bunch of stuff. One point being that I would EXPECT job growth to be more robust than the 90s or the 03/04 cycle as this recession was DEEPER. The entire dynamic of the business cycle and recession is one of “withheld demand” and overly pessimtic risk positioning returning to spending and the market. The “V-shape” still looks more right than wrong… and you’ll see that in 6-9 months. If you dont see it today.

    The other fundamental error running through this theme… is that somewhat slightly slower recovery is worrisome. Its not. This is true in 2 ways. First… its still a strong recovery trend as I pointed out before. +162k is closer to “super recovery” than it is to “worrisome”. Even if it literally IS NOT +300k (duh?!). Second… if companies are doing this well and EPS growth is this good with only a modest recovery… doesnt that say they is LOTS of room to run? I mean recovery is natural. Unemployment supports “slack” with keeps deflation pressures on. Low rates work, with long lags. All else equal… a slow +250k /month NFP number is a 3-yr recovery trend… rates stay ultra-low and stocks post great, gradually improving earnings each year.

    Again, this is not really worrisome. It may in fact be even better.

  38. Rob King says:

    @cognos,

    A few points.

    (1) This recession was definitely DEEPER. I think the number floating around is something on the level of 8 million jobs lost since the peak. This, however, merely means that the recovery would have to be LARGER on a numerical basis. (i.e. – we have 8 million jobs that we have to get back) Now, it’s an entirely different thing to say that the job growth will be more ROBUST (i.e. – recover the 8 million jobs through a process that brings jobs back at a quicker pace than during the 90s or 2001-2007). Like I’ve said three times (including this one), it’s certainly possible. However, I’m not seeing how that would happen… If you’ll remember, the 90s saw explosive growth in tech (which was later given up) and 2001-2007 saw great growth in housing-related functions/industries (which was also later given up). I’m not seeing this boom’s tech/housing-type lead-in…

    (2) I actually don’t believe that a slightly slower recovery would be worrisome as pertains to the economy. I’m merely saying that the price of the stock market at these levels is worrisome considering the possibility of a slow recovery. Those two are completely different issues.

    (3) The whole point of parsing through the 162K number by breaking out the Census effect and the new entrants into the job market is to see if we’ve made any progress towards recovering the 8 million number. Once you subtract out the 48K for Census and the 100-150K for new entrants, you get a number pretty close to zero for recovery of the 8 million. Now, again, this isn’t to say next month’s number can’t or won’t explode to 500K and take care of next month’s new entrant and Census hurdles and make serious gains to recovering the jobs lost since the peak. I’m merely saying that this March’s numbers didn’t do that.

    (4) The point of saying that we didn’t hit 300K was merely to point out that analysts’ predictive ability on these things are not what they’re cracked up to be. There’s a great James Montier article/graph that shows this, but the title of the article slips my mind.

    (5) Productivity gains are not the same as top-line gains. Companies might be doing great on productivity gains, but unless they continue to cut their labor costs (not so great because it adds to unemployment) then they’re going to have to increase their revenues (from…) Now, productivity gains may lead to employment gains, but they would only lead to employment gains if the companies believed that top line gains (from…) would require additional employment, no? Chicken meet egg?

    (6) A slow +250K/month NFP number would not recover the 8 million jobs in 3 years. Remember, we have a 100-150K new entrants into the job market every month. So +250K/month NFP is really, at best, +150K/month NFP that we can sock away towards our 8 million job deficit. That comes out to be around 4 and a half years. (Maybe that difference doesn’t matter much to you, but I find that to be worrisome because the market doesn’t seem to be factoring in 4 and a half years.)

    In any case, we may have to agree to disagree on this one.

    And for the record, I’m not one of the bears that underinvested in the rally. I pretty much went all-in during October 2008 and didn’t exit until January 2010. Now I’m wading in slowly as I find, increasingly sparse, value plays.

  39. Mannwich says:

    Where are these so-called “jobs” coming from? The last time it was all built around the FIRE sectors. Well, this time housing and CRE are flat-lining, so neither are leading us out. Where’s it going to be? What sectors are going to see the jobs “boom”? I’m all ears.

  40. Mysticdog says:

    I heard a hideous story yesterday at dinner.

    A company was in the practice of laying off its workers, then offering them their jobs back in a few months at significant pay reductions.

    If they declined to take the job, they were reported to the unemployment agency for refusing to work. The company actually warned the people if they declined the offer or hedged that they would do this.

  41. Mannwich says:

    I’m not that surprised, but is that even legal, Mysticdog? Wait, silly me, who cares if it’s legal anymore? Anything goes if you got the clout.