March Employment Numbers Mixed, But More Bad than Good
Overall job growth for March 2016 was good, but not great, with 215,000 jobs created for the month. Economists reckon that at least 100,000 new jobs per month must be created to keep unemployment from rising, while they also estimate that 300,000 new jobs per month or better is necessary to really start working against the backlog of long-term unemployed and underemployed persons in the United States.
The 215,000 number falls pretty much dead in the middle of that range, entirely in keeping with recent job growth rates for the past many months now. Likewise, the revisions to the numbers for January and February were a wash, with a net loss of 1,000 jobs for those two months (January went down from 172,000 to 168,000 jobs, while February went up from 242,000 to 245,000 jobs).
Average working hours were unchanged, while wages increased by a paltry $0.07 per hour for March, continuing the long-term trend for slow and/or modest growth that has characterized the economy (with a few exceptions) since 2013 or thereabouts.
Digging into the numbers in Table A-14 ("Unemployed person by industry and class of worker, not seasonally adjusted") to scope out the Information sector, I see that while the unemployment rate is up, overall sector employment has finally started to show some growth.
Sector size has been steadily declining for the past year or more, so this reversal is a good sign that more hiring into the sector is finally starting to occur. To get some context for the current report, one year ago in March 2015, Information sector numbers stood at 84,000 unemployed, for an unemployment rate of 3 percent.
For March 2016, those numbers are 124,000 unemployed, for a rate of 4.4 percent. Do the math, and the sector size increases from 2.8 million to 2.82 million, for a slight increase of 18,000-plus Information jobs over the past year. Though unemployment is up by 40,000 jobs it is at least part-way mitigated by the increase in the total sector population.
I'm reasonably convinced this means that IT hiring is finally starting to pick up, as modest gains in overall economic growth and a tight labor market for IT professionals starts to prime the hiring pump — even if only just a bit.
Where are the bright spots? For one thing, the official U.S. numbers beat the ADP forecast released yesterday by 15,000 jobs. ADP, a major payroll services provider, had reported its own job growth figures from the private sector at an even 200,000 jobs added for March.
For another thing, any sign of a sector size increase for Information strikes me as at least a hint that our home sector is finally starting to turn around.
And finally, the modest 0.1 percent jump in overall unemployment from 4.9 to 5 percent, as well as the niggling reduction in the January and February numbers (down by only one thousand), indicates that even the negative aspects of the current report are soft and quite small.
That's why I find more rays of sunshine than dark clouds in this latest report on the jobs situation. Now the question becomes: can we keep this up, and keep improving as we start heading into the summer season? Only time will tell.