Jobs Data Picture: Clear As Mud

by: William Trent, CFA
Employment Situation Summary: Nonfarm payroll employment rose by 180,000 in March, and the unemployment rate was essentially unchanged at 4.4 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.

Employment increased in construction, retail trade, and health care. The number of manufacturing jobs continued to trend down. Average hourly earnings rose by $0.6, or 0.3%, over the month.

That 180,000 was more than expected, and the job additions for both February and January were revised upward as well, leading to a frenzied but ultimately pointless CNBC talking head discussion given that the markets were closed for Good Friday. According to various participants, the data tell us:

* The Fed will take longer to cut rates
* We can forget about housing spillover - at least for a month
* The economy is getting stronger
* This was a blowout number
* This is good for stocks
* This is bad for stocks

When we look at the data it tells us none of those things. We have frequently said the headline number undergoes too many subjective adjustments to be meaningful. So we hereby take our monthly look at the raw data - year over year change in employment, non-seasonally adjusted.

YOY Change in Employment Chart

Does that tell you anything that would prove or disprove any of the statements above? To us, it looks like the rate of jobs growth could be slowing, bottoming or even sputtering toward acceleration. Perhaps it was better that the news was released on a market holiday, as fewer people had the opportunity to misinterpret it. Move along, folks. There’s nothing to see here.

Related Articles: What Will Friday's Data Mean For This Week's Market?; March Jobs Report Surprise