Voted Best Real Estate Company in SLO County in the 2017 New Times Reader Poll
No Comments

Jobs and Employment Situation

Jobless Claims

Jobless claims increased from the prior week’s 49 year low; up 21,000 to 231,000 in data for the week of March 3rd. The four week average is up 2,000 to 222,500, still several thousand behind levels seen a month ago in what is a favorable comparison and points to a positive employment report. Continuing claims, in lagging data for the week of February 24th, fell a sharp 64,000 to 1.8970 million with this four week average at 1.907 million, 40,000 below the month a go comparison. The unemployment rate for insured workers remains very low at a rate of only 1.3 percent.

Employment Situation

Wage inflation still remains unchanged, but the flashpoint may be sooner than later based on unusual strength in the February employment report.  Nonfarm payrolls rose an outsized 313,000 which is more than 80,000 above economists’ high estimates. Revisions add to this strength, at a net 54,000 for January which is now revised to 239,000 and December now at 175,000. Strength in construction is a standout in the report as payrolls in the sector surged 61,000 in February following gains in the three prior months, all above 40,000. Manufacturing is also very strong up 31,000 for its fifth straight strong gain. Retail, recently uneven, added 50,000 as did professional and business service3s where the closely watched temporary help subcomponent spiked 27,000 in an indication that employers are trying to fill positions. Government payrolls, which have recently been weak added 26,000 to February’s nonfarm total. Despite this strength, average hourly earnings came in below expectations of economists at only plus 0.1 percent and a yearly rate that is 3 tenths below the 2.6 percent consensus. But given the strong labor demand, policy makers at the Federal Reserve may not want to run the risk of runaway wage gains as employers try increasingly to attract candidates. The work week points to further strength, up 1 tenth to an average of 34.5 weekly hours for all employees and the prior month revised 1 tenth higher to 34.4 hours; the private sector workweek rose 2 tenths to 38.8 hours with manufacturing also up 2 tenths to 41.0 hours in a gain pointing to strength for the industrial production report coming out next 3week. The unemployment rate held at a very low 4.1 percent as discouraged workers entered the jobs market. The labor participation rate, another major headline, was up 3 tenths to 63.0 percent and again well beyond the high end of economists’ expectations. The strength in hiring solely in this report would appear certain to raise expectations for four rate hikes this year by the Fed policy makers.

Written by Central Coast Lending - Go to Central Coast Lending's Website/Profile