Posted on 04/04/2003 9:18:50 AM PST by P.O.E.
WASHINGTON (CBS.MW) -- The U.S. labor market continued to convulse in March, as 108,000 jobs were destroyed following a loss of 357,000 in February, the Labor Department said Friday.
The nation's unemployment rate remained at 5.8 percent, with 8.45 million Americans officially looking for work.
"Labor market conditions remained sluggish in March," said Kathleen Utgoff, commissioner of the Bureau of Labor Statistics.
Combined with the downward revision to February's payrolls, the job losses over the past two months were about 145,000 worse than expected by Wall Street economists.
A survey of economists estimated, on average, a loss of 17,000 jobs in March. They also expected the jobless rate to rise to 6 percent.
Financial markets largely ignored the jobs report. Stocks opened marginally higher, pressuring bonds. See Market Snapshot and Bond Report.
"No one seems to care much about the lousy U.S. jobs report right now," analysts at Briefing.com said. "We think that could prove to be a costly mistake."
Investors remain focused on the cause of the recent weakening in the economy -- chiefly the war and high energy costs, said Tony Crescenzi, chief market strategist at Miller Tabak. "Developments on these fronts have clearly been very positive of late -- oil is down sharply again today, for example."
The jobs report continues a string of worse-than-expected economic reports in the past week that is trying the patience of the Federal Reserve.
On Tuesday, the Institute for Supply Management said its manufacturing index fell to 46.2 percent, the first sign of contraction in the factory sector in five months.
The Fed has expected the economy to improve once the war in Iraq is concluded, but the data have been weak enough in the months and weeks leading up to the war to make Fed policy makers nervous about the strength of any postwar bounce.
The Fed's interest rate target remains at a four-decade low of 1.25 percent. The Fed will be able to look at one more labor market report before the May 6 meeting of the Federal Open Market Committee.
Few economists expect the Fed to act immediately on the weak jobs data.
"Cutting rates further will not stimulate spending as long the war continues," said Brian Bruce, director of PanAgora Asset Management. "Cutting rates will do nothing to change the psychology of corporations at this point."
However, Lehman Brothers' economists "continue to expect the Fed to be forced to cut rates further, with the odds continuing to favor an intermeeting move," said Drew Matus, an economist at Lehman.
The weak data could also pressure Congress to pass a larger tax cut quicker.
"This news only serves to underscore the need for Congress to pass the president's growth package as soon as possible to ensure that every American who wants a job can find one," said Labor Secretary Elaine Chao.
"Despite these appalling economic conditions, President Bush is proposing more of the same -- massive tax cuts that largely benefit the wealthy," said House Democratic Leader Nancy Pelosi of California. "The administration has put forward this plan even though their own economic advisers say it won't create enough jobs to make up for those lost in the past two months, let alone the past two years."
The details of the jobs report were mixed.
Average hourly wages rose 0.1 percent to $15.10. The aggregate number of hours worked in the economy rose 0.3 percent as the average work week rose by 12 minutes to 34.3 hours.
Job losses were widespread throughout most sectors of the economy in March. Since the recession began two years ago, 2.1 million jobs have been lost.
Goods-producing industries cut 14,000 jobs in March, including 36,000 in manufacturing. No major manufacturing sector added workers. Construction added 21,000 jobs, a bounce back from February's weather-related losses of 42,000 jobs.
Service-producing industries cut 94,000 jobs. Retail firms sliced 43,000 workers, bringing the total lost since June 2001 to 470,000. Government cut 40,000 jobs, most were in local education.
Temporary help firms cut 48,000 workers in March, the largest decline since September. Temp jobs are often the first to be added and the first to be lost in today's flexible workplace. More than a half million temp jobs have been lost in the recession.
Transportation lost 14,000 workers in March, bringing the loss since January 2001 to 301,000. Half of those jobs were at airlines.
The jobless rate remained at 5.8 percent because 267,000 Americans dropped out of the labor force. Nearly a million Americans dropped out in the first quarter.
"The jobless rate failed to rise only because many unemployed workers stopped actively looking for jobs (a necessary condition to be included in the Labor Department's official labor force count)," said Jade Zelnik, chief economist at RBS Greenwich Capital. "This leaves little doubt that the underlying trend for joblessness is still upward."
More troubling, the number of Americans who currently want a job but are not actively looking because they are discouraged jumped by 558,000 in March to 5.02 million.
Plunge?
Appalling economic conditions?
Don't forget, the media kept up the recession drumbeat for a year before the 1992 election. If they whisper it enough, it eventually will seep into decision-making by consumers.
Not to deny the economy is sluggish and markets are down. Just wanted to point out the Dems are trying to move the discussion to the economy, brow-beating Bush at every turn. The media is only all too willing to spread exaggerated bad news.
Keep your eyes open for it.
Moreover, this war will open up (slightly at first) still newer markets for U.S. goods.
higher than any would like but news that rate remains the same is reported as a plunge! if they weren't so transparent it would be funny.
I'm not as optimistic as I was, mainly because I don't see where the tech sector will break through---but that's probably a good sign, since if I could see it, I'd already be rich!
By your comment I can only assume you didn't read the article. This author was not simply reporting the news, but getting an early start on his novel.
Are you accusing the author of lying about the unemployment figures?
Someone needs to email this jerk's editor and tell him to tighten up on this guy.
No.
What is the actual unemployment rate if the number of workers, who have stopped actively looking for jobs, is included in the official count?
Our unemployment is the best of any nation. France and Germany are over 12%.
Notice how these CBS maggots of gloom and doom never talk about the unemployment of other countries.
CBS is a propaganda arm of the US Internal Axis of Evil.
because they're two sides of the coin - new jobs are created while others are eliminated, in this case the net offset negated each other (but is errantly described as a "plunge" out of apparent bias by the author)
I seem to remember statistics claiming between 8 & 10 million illegals currently within our borders.
Ain't that something?
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