New jobs in the private sector increased by a disappointing 139,000 last month, according to today's ADP Employment Report for February. The consensus forecast via surveys of economists expected 150,000, although The Capital Spectator's econometric projection anticipated a lesser gain; albeit one that turned out to be too low relative to the actual number. In any case, the labor market is still expanding at a comparatively weak pace by the standards of the past year or so. Although February's advance was a bit faster than the increase for January, that's only because of ADP's downward revision for the first month of the year in today's update.
The optimistic spin is still one of blaming the weather. Mark Zandi, chief economist at Moody's Analytics, said in a press release:
"February was another soft month for the job market, employment was weak across a number of industries. Bad winter weather, especially in mid-month, weighed on payrolls. Job growth is expected to improve with warmer temperatures."
In that case, we should expect to a rebound in the March data that's scheduled for release next month. Meantime, the bulls are clinging to the weather narrative. That's still a plausible explanation, but at this stage it remains a theory.
Meantime, the weakness in the monthly numbers is beginning to take a toll on the year-over-trend. Private payrolls increased 1.9% for the year through last month, the slowest annual rise since last May.
Among the analysts who think more encouraging numbers are coming is Scott Brown, chief economist at Raymond James:
"As you head to Friday's payroll report [from the Labor Department], you are looking at another month of weather effect. It still suggests things are improving but it's hard to gauge the exact strength of the job market. Things should look less distorted in March and April. Spring is make or break time for [the] economy."
As for Friday's official jobs report for February, the winter blues are expected to keep optimism on ice for the immediate future.