Initial Reaction

Today’s employment report shows a wild miss in the expected number of jobs. The Econoday consensus estimate was 175,000 and ADP expected 263,000.

Instead, the BLS reported and increase of 98,000. Economists did what they usually do in such situations: blame the weather.

“Throw ADP out, it was the weather in March! Or at least the Category 3 storm that swept the Northeast may explain a much weaker-than-expected 98,000 increase in March nonfarm payrolls. This compares with Econoday’s consensus for 175,000 and a low estimate of 125,000” says Econoday.

“The big storm hit during the sample week of the employment report and apparently delayed new hiring, or at least that will be the takeaway from the report,” added Econoday.

That aside, the internals of the report as measured by the household survey were actually very good. but revisions to the establishment survey weren’t.

Revisions

The change in total nonfarm payroll employment for January was revised down from +238,000 to +216,000, and the change for February was revised down from +235,000 to +219,000. With these revisions, employment gains in January and February combined were 38,000 less than previously reported. Monthly revisions result from additional reports received from businesses since the last published estimates and from the recalculation of seasonal factors. Over the past 3 months, job gains have averaged 178,000 per month.

Let’s dive into the details in the BLS Employment Situation Summary, unofficially called the Jobs Report.

BLS Jobs Statistics at a Glance

  • Nonfarm Payroll: +98,000 – Establishment Survey
  • Employment: +472,000 – Household Survey
  • Unemployment: -326,000 – Household Survey
  • Involuntary Part-Time Work: -151,000 – Household Survey
  • Voluntary Part-Time Work: -50,000 – Household Survey
  • Baseline Unemployment Rate: -0.2 to 4.5% – Household Survey
  • U-6 unemployment: -0.3 to 8.9% – Household Survey
  • Civilian Non-institutional Population: +168,000
  • Civilian Labor Force: +145,000 – Household Survey
  • Not in Labor Force: +23,000 – Household Survey
  • Participation Rate: +0.0 to 63.0 – Household Survey
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