A Cold Chill for March Jobs


The job market had a rough go of it in March. Blame the weather, a stronger US dollar or a natural slow down after 12 months of more than 200,000 jobs, but a late winter chill blew through the U.S. economy in the third month of 2015. The Bureau of Labor Statistics said 126,000 new jobs were added last month, half of the consensus estimate for 250,000 and the worst reading since December 2013. Adding to the cool down, the previous two months were revised lower by 69,000, which means that job creation in the first quarter of 2015 averaged 197,000, down sharply from the average of 324,000 in the final quarter of 2014.

The unemployment rate remained at 5.5 percent, because the labor force contracted by 95,000. The broader unemployment rate, which includes people who are working part-time because they can’t secure full time positions and marginally attached workers, remained stubbornly high at 10.9 percent.

The labor force participation rate (the number of Americans in the labor force or actively seeking employment) edged down to a 37-year low of 62.7 percent and is also at the bottom end of its narrow range of 62.7 to 62.9 percent for the past year. Economists say that about half of the three-point slide in participation rate from before the recession is attributable to demographic factors, like the retirement of Baby Boomers. Still, it is disappointing that the 3.1 million jobs created over the past year have not yet encouraged more workers to re-enter the labor force.

And despite the recent announcements of minimum wage increases at McDonald’s, Wal-Mart and Target, average hourly earnings advanced by just 2.1 percent from a year earlier. Wages grew at a better than 3 percent rate annually during the prior economic recovery that ended in 2007. The silver lining is that wages can bounce fairly quickly and there are signs that employers are feeling the pressure to increase pay to attract and retain talent.

All major U.S. stock exchanges are closed for Good Friday, but the immediate market reaction was seen in the electronic trading of the Chicago Mercantile Exchange’s equity index futures, which indicated a more than 160 point Dow sell off after the jobs data was released. In one respect, that was actually comforting. It seems that bad news may finally be seen as bad news for investors, rather than a reason to over think when the Fed might next increase interest rates.

On the rate front, because economic growth likely slowed down in during the first three months of the year (the Atlanta Federal Reserve estimates that Q1 growth was flat) and the Fed has said that it will be data-dependent, many economists and analysts now believe that the first hike will occur in September.


  • DJIA: 17,763, up 0.3% on week, down 0.3% YTD
  • S&P 500: 2067, up 0.3% on week, up 0.4% YTD
  • NASDAQ: 4887 down 0.1% on week, up 3.2% YTD
  • Russell 2000: 1255, on week, up 4.2% YTD
  • 10-Year Treasury yield: 1.84% (from 1.9% a week ago)
  • May Crude Oil: $49.14, up 0.6% on week
  • May Gold: $1200.90, up 0.1% on week
  • AAA Nat'l avg for gallon of regular Gas: $2.40 (from $2.43 week ago, $3.57 a year ago)


Mon 4/6

10:00 ISM Non-Manufacturing

Tues 4/7:

10:00 Job Openings and Labor Turnover Survey (JOLTS)

3:00 Consumer Credit

Weds 4/8:

2:00 FOMC Minutes

Thurs 4/9:

Fri 4/10:

8:30 Import/Export Prices