–Retransmitting Story Published 9:31 ET Friday
–March Payrolls Below Expectations at +120,000; Unemp Rate 8.192%

By Denny Gulino

WASHINGTON (MNI) – March payroll gains did not reach expectations
and the sensitive jobs category of temporary help leveled off but the
unemployment rate improved a tenth to 8.2% as the labor force continued
its unexplained contraction.

The Bureau of Labor Statistics Friday reported 120,000 additions to
payrolls after seasonal adjustment, well short of the 200,000 expected.
Health care’s recent strength slowed slightly while retail employment
declined by 34,000, two-thirds in department stores. Temporary help
gains leveled out.

Before adjustment, payrolls actually rose 811,000 including an
estimated 90,000 added in new firms not captured by the monthly survey.

“Retail was going down a bit,” Dori Allard, chief of the BLS
Division of Labor Force Statistics, told MNI shortly before the report’s
publication. “The loss there was mainly in general merchandise stores
and two-thirds of that was in department stores.”

Except for the decline in retail employment, a softer health
employment category that still showed 26,000 more jobs, and some leveling
of temporary help, the March report was characterized by the absence of
change rather than unexpected shifts.

In the survey of households, which determines the unemployment
rate, there was a larger-than-usual improvement in the category of those
working part-time for economic reasons, a decline of 447,000 to 7.7
million. “That series is a little bit bouncy,” she said, with February’s
decline only 111,000 and January’s 132,000.

Manufacturing continued its rebound, rising 37,000, mostly in
durable goods industries much of which supports the auto industry. There
was also a small pop of 3,000 in the paper industry. Since the trough
there in January 2010, manufacturing has added 470,000 jobs.

Financial activity jobs rose 15,000, with most of that in credit
intermediation.

Food services and drinking places rose 37,000 in March and has been
a strong contributor since its low point in February 2010, adding
563,000 jobs.

The category of professional and business services, a key business
activity indicator, added another 31,000 jobs in March but they skewed
toward the lower end of the pay scale, with 23,000 of them in building
services. The temporary help subcategory that can be a sensitive
barometer of hiring pressure backed off from its recent monthly gains,
hardly changing in March. In February that category rose 55,000.

The average workweek for all employees slipped a tenth of an hour
to 34.5 hours and the manufacturing workweek fell even more, by 0.3 hour
to 40.7 hours. Factory overtime was unchanged at 3.4 hours. The numbers
for the smaller universe of production and nonsupervisory employees was
unchanged at 33.8 hours.

But the persistent underlying mystery of why the overall labor
force keeps shrinking instead of showing new jobseeking entrants was
behind the month’s improvement in the unemployment rate, Allard said.

The total unemployed in the survey of households in March
was 12.7 million, improved from February’s 12.8 million but not enough
to be statistically significant in BLS terms.

The overall labor force got 164,000 smaller in March, also not
a statistically significant change but nevertheless a curiousity given
the better jobs atmosphere lately. Without seasonal adjustment the labor
force has risen to 154.316 million in a year from the March 2011
153.022 million

Those in the category of “not in the labor force” rose 333,000 in
March. That category had also bumped up when the 2010 Census figures
were integrated into the numbers. This time, Allard said, “that’s going
on a little bit there,” and in fact, she said, it looks like all the
monthly population growth “is pretty much going into the non labor
force” category, totaling 87.897 million in March after adjustment.

The BLS surveys don’t gather data as to why, but analysts in and
out of the BLS has pondered for months why an improving jobs picture is
still not having its usual aftereffect of encouraging more job seekers,
whose quest brings them into the formal labor force total.

Those in the BLS category of currently wanting a job were 6.299
million in March, down from 6.378 million February, 6.319 million in
January and 6.385 million in December.

Another improvement discernible below the surface of the March
report was that those looking for work are finding it a little bit
faster, “which I thought was interesting,” she said. “The weeks
unemployed is coming down a little bit,” she said. “It’s still very,
very high now at 19.9 weeks but it hasn’t been that low since February
2010.”

Before that, she said, the previous low was October 2009, at 18.9
weeks. “It has started to get down closer to its pre-recession. In June
2010 that duration was 25 weeks.

The total of the long-term unemployed, over six months, was about
unchanged at 5.3 million in March and accounted for 42.5% of all
unemployed. Since April 2010, that total has fallen 1.4 million.

The civilian labor force participation rate, at 63.8%, and the
employment-population ratio, at 58.5%, both dropped a tenth in March.

Expectations in an MNI survey centered on a gain of 200,000 overall
payroll slots in March in a range of 175,000 to 250,000, with 210,000
private payroll additions and an unemployment rate that stayed at 8.3%.

** MNI Washington Bureau: 202-371-2121 **

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