Unemployment Rate Drops To 7.6 Percent

U.S. employers added just 88,000 jobs in March, the fewest in nine months and a sharp retreat after a period of strong hiring. The slowdown is a reminder that the job market's path back to health will be uneven. The Labor Department says the unemployment rate dipped to 7.6 percent from 7.7 percent.

By Christopher S. Rugaber, AP Economics Writer

WASHINGTON (AP) -- U.S. employers added just 88,000 jobs in March, the fewest in nine months and a sharp retreat after a period of strong hiring. The slowdown is a reminder that the job market's path back to health will be uneven.

The Labor Department says the unemployment rate dipped to 7.6 percent from 7.7 percent. While that is the lowest in four years, the rate fell only because more people stopped looking for work.

The weakness may signal that companies were worried last month about steep government spending cuts that began on March 1.

March's job gains were half the pace of the previous six months, when the economy added an average of 196,000 jobs a month. The drop raises fears that the economy could slow after a stronger winter.

---

U.S. Manufacturing Sector Loses 3,000 Jobs in March: Alliance for American Manufacturing (AAM) Statement

Alliance for American Manufacturing's #AAMeter Shows U.S. at + 30,000 Jobs Toward President Obama's Second Term Goal of 1 Million New Manufacturing Jobs; Manufacturing sector Loses 3,000 jobs in March.

The latest monthly U.S. jobs report shows America's manufacturing sector lost 3,000 jobs in March, 2013, a setback in the path of 21,087 factory jobs that need to be gained each month in order to meet the president's goal.

Commented Scott Paul, President of the Alliance for American Manufacturing (AAM): "Manufacturing lost 3,000 jobs in March, and employment in the industry has changed very little over the past 11 months. I believe we can see a resurgence in manufacturing job growth, but only with the right public policies. The myopic focus of Congress on our fiscal position is backfiring already. The focus must be on jobs. We have a plan to create those jobs—Congress would be well-advised to act on it."

THE #AAMETER

During the 2012 presidential campaign, President Obama set a goal of creating 1 million new manufacturing jobs in his second term. To follow the president's progress, the Alliance for American Manufacturing (AAM) has launched a Jobs Tracker, the #AAMeter.

By using monthly jobs data from the Bureau of Labor Statistics (BLS), AAM is maintaining a running monthly tally of manufacturing jobs created during the president's second term. 

“Manufacturing is the key to a strong middle class, and the American people have made clear that they want ‘Made in America,’” said Paul. “While the American people understand that economic course corrections take time, they want to see growth in manufacturing employment."

In an editorial in USA Today, Paul explained that President Obama can increase employment in the nation’s manufacturing sector if he takes action to hold China accountable for its continued violations of trade agreements, and follows through on campaign pledges to close tax loopholes that encourage outsourcing.

“As hard as it is to believe, the United States is the only major industrial nation that does not have a cohesive national manufacturing strategy,” said Paul. “We’ve outlined steps the president should to help meet his manufacturing jobs goal. If the Administration and Congress show a genuine willingness to act on these common sense policies, we’ll see our Jobs Tracker move toward 1 million jobs gained.”

The Alliance for American Manufacturing is a non-profit, non-partisan partnership formed in 2007 by some of America’s leading manufacturers and the United Steelworkers to explore common solutions to challenging public policy topics such as job creation, infrastructure investment, international trade, and global competitiveness. For more information, please visit www.americanmanufacturing.org

---

Manufacturing Sheds Jobs in March

Posted by: Chad Moutray on the Shopfloor Blog

Manufacturing employment declined by 3,000 in March according to the Bureau of Labor Statistics, its first decrease since September. Manufacturing employment has been soft over much of the past year, with just a few exceptions. The sector has added 77,000 net new workers over the past 12 months.

Over that time frame, there were 1.9 million nonfarm payroll workers hired, implying that manufacturers created just 4 percent of all of the net new jobs since March 2012. That really illustrates how uncertainty and weak global demand have impacted a sector that had before last year been providing outsized growth for output and employment. Since the end of the recession, manufacturers have hired an additional 510,000 workers, or roughly 9 percent of all new jobs.

Looking specifically at the manufacturing employment numbers for March, the durable goods sectors added 4,000 additional workers, with nondurable goods industries shedding 7,000. The largest monthly gains were seen in the fabricated metal products (up 3,400), machinery (up 3,000), primary metals (up 2,000), and plastics and rubber products (up 1,200) sectors. In contrast, some of the sectors with declining employment for the month included apparel (down 2,500), food products (down 1,600), wood products (down 1,300), and textile product mills (down 1,000).

The data on hours worked and compensation in the manufacturing sector were largely unchanged in March. The average weekly earnings for the industry edged marginally lower from $987.74 to $986.14. On the positive side, weekly earnings remain higher than the $978.84 average observed in January. In terms of average weekly hours, they also were slightly off, down from 40.9 to 40.8. This was somewhat counteracted by an increase in the average overtime hours of 3.4 in March, up from 3.3 in February.

The overall U.S. economy added just 88,000 nonfarm payroll jobs in March, well below the consensus estimate of around 200,000. This suggests that overall hiring has slowed considerably from January and February, both of which were revised higher from their earlier estimates. January's nonfarm job growth changed from 119,000 as originally suggested to 148,000, and February's data rose from 236,000 to 268,000. That 59,000-worker upward revision helps take at least some of the sting out of these poor numbers, but this is still a very negative report.

The other headline number from the BLS jobs numbers is that that unemployment rate fell from 7.7 percent to 7.6 percent. On the surface this looks like good news with unemployment down 0.6 percentage points from the 8.2 percent rate observed in March 2012. However, the rate fell in March due to a decline in the participation rate. Last year at this time, the participation rate was 63.8, and it was 63.5 in February. The rate fell to 63.3 percent in March, its lowest level since May 1979.

Today's employment report suggests that there are significant weaknesses in the U.S. economy, even as we have seen some progress in 2013. It's becoming clear that higher taxes and across-the-board federal spending cuts have had an impact. Federal government employment declined by 14,000 in March. Much of these losses came from the U.S. Postal Service which was down 11,700. At the same time, we continue to hear anecdotal evidence from several retailers that increased payroll taxes have reduced sales, with 24,100 fewer workers in the retail trade sector.

For manufacturers it is also clear that the sector has not been able to muster any broad-based momentum in terms of job creation. While we have seen evidence of higher sales and production in many economic indicators so far this year, it has not necessarily translated into increased hiring. There is still a skittishness and uncertainty to hire on the part of many businesses. Until business leaders sense that the economy is on a firmer footing, there will continue to be a hesitancy to increase employment. Washington continues to move from one crisis which is taking its toll on our economy and job creation.

It's also important to note the unknown in these data is the impact that the Affordable Care Act has had on hiring. We will continue to watch this closely over the next year as we move towards the law's implantation. Concerns related to the law and health insurance rose to the number one concern in the first quarter NAM/IndustryWeek Survey of Manufacturers<http://www.industryweek.com/global-economy/namindustryweek-2013-q1-survey-manufacturers-prospects-picking?page=2> released last month.

Chad Moutray is chief economist, National Association of Manufacturers.


More in Home