Thursday, March 31, 2016

Preview: Employment Report for March

by Bill McBride on 3/31/2016 01:47:00 PM

On Friday at 8:30 AM ET, the BLS will release the employment report for March. The consensus, according to Bloomberg, is for an increase of 210,000 non-farm payroll jobs in March (with a range of estimates between 175,000 to 241,000), and for the unemployment rate to be unchanged at 4.9%.

The BLS reported 242,000 jobs added in February.

Here is a summary of recent data:

• The ADP employment report showed an increase of 200,000 private sector payroll jobs in March. This was close to expectations of 203,000 private sector payroll jobs added. The ADP report hasn't been very useful in predicting the BLS report for any one month, but in general, this suggests employment growth close to expectations.

• Since the employment report is being released on the 1st of April, the March ISM manufacturing and non-manufacturing employment indexes are not available yet, and will be released after the employment report this month.

Initial weekly unemployment claims averaged close to 263,000 in March, about the same as in February. For the BLS reference week (includes the 12th of the month), initial claims were at 265,000, up slightly from 262,000 during the reference week in February.

This suggests about the same level of layoffs in March as in February (very few).

• The preliminary March University of Michigan consumer sentiment index decreased to 90.0 from the February reading of 91.7. Sentiment is frequently coincident with changes in the labor market, but there are other factors too - like lower gasoline prices.

• Conclusion: Some of the usual indicators will be released after the employment report this month. The available data suggests job growth in the 200 thousand plus range again in March.