U.S. Economic Data
- March Jobs Report: Still Stuck in Second Gear
- U.S. Economy: These Jobs Numbers Point to Slower Growth in Q2
- Disastrous U.S. Jobs Report Pummels the Market
- Can Fed Beige Book, Recent U.S. Economic Data Support the Dow Above 13000?
Anyone hoping the U S. economy in 2013 would gain strength from job growth needs to check out Wednesday's ADP National Employment Report.
According to ADP, the U.S. economy added 158,000 private-sector jobs in March, well below projections of 200,000 - 215,000. That's the smallest gain since October when companies hired just 148,000.
March's lackluster showing was mainly due to lower job creation in construction. The industry enjoyed robust hiring in the months following late October's Hurricane Sandy. In its wake, the superstorm left behind upwards of $50 billion in damages.
A tepid recovery in the housing market in Q1 also helped the sector in January, with recent monthly gains in construction averaging 35,000.
In March, however, no new construction jobs were added.
"If that's the case, underlying job growth is not changed appreciably," Moody's Analytics chief economist Mark Zandi told Reuters. He estimates overall employment growth is running near 175,000 a month.
March's jobs report included a revised 237,000 gain for February from the previously reported 198,000. But January's numbers were revised down to 177,000 from 215,000.
So what does this mean for Friday's U.S. jobs report?
American businesses in May added the smallest number of workers in a year, only 69,000 - less than half of the median analysts' estimate of 150,000.
The unemployment rate unexpectedly ticked up from 8.1% to 8.2% as job seekers returned to the workforce, the Labor Department report revealed.
In addition, revisions from previous months showed the economy gained fewer jobs in March and April than originally believed. March's employment numbers were reduced by 11,000 jobs to total 143,000, while April's plunged by 38,000 to total a lousy 77,000.
The disappointing numbers cast doubt on the strength of the U.S. economic recovery, and also overshadow any evidence that the labor market is improving.
The news sent the Dow Jones tumbling some 160 points on the open and more than 220 points by noon, with the other indexes following. While many traders were anxious to see May end, June hasn't started off in the right direction.
"Yuck, this is really not good," Michael Mullaney, who helps manage $9.5 billion as chief investment officer at Fiduciary Trust, bluntly told Bloomberg News. "We're at a very precarious point right now as far as investors' psyche is concerned."
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