–Construction Sector Improvement of Note
–But Monthly Earning For All Workers Dwn For 1st Time Since Jan’07
–Monthly Earnings For Production Workers Down 1st Time Since Apr, 2003

By Yali N’Diaye

WASHINGTON (MNI) – The March nonfarm payrolls did not rise as much
as analysts had expected, but the report was rather positive nonetheless
as the economy created a net 162,000 jobs on the month, the largest gain
since March 2007, a Bureau of Labor Statistics analyst said Friday.

While government hiring was boosted by the decennial Census,
private sector gains of 123,000 jobs were the largest since May 2007.

The BLS said 48,000 temporary workers were hired in March by the
Census Bureau (not seasonally adjusted), somewhat less than many
analysts had expected, partly explaining the gap between the actual
payrolls and the expected median forecast of an increase of 200,000. The
government added a net 39,000 payrolls in March.

Many sectors saw an increase in payrolls, although information and
financial activities continued to shed jobs.

Despite the 162,000 gain in nonfarm payrolls, the unemployment rate
remained unchanged at 9.7%, as expected by analysts.

BLS chief of the employment section Tom Nardone told Market News
International in a pre-publication briefing that the unchanged
unemployment rate can be explained by the fact the rate is calculated
based on the household survey, which in particular shows an increase in
the labor participation rate to 64.9% from 64.8%.

But the household survey also showed that employment was up 264,000
and unemployment up 134,000 in March.

Private economists — and the administration — are looking for
signs that private sector hiring has turned the corner, and one might be
found in the construction sector.

Nardone said that while the 15,000 increase in construction jobs is
not “statistically significant,” it does contrast with the average
72,000 monthly drop over the past 12 months.

“Being close to zero is much different” from an average 72,000
loss, Nardone commented. Over the first two months of the year alone,
construction has lost a net 119,000 jobs.

That, however, has to factor in bad weather conditions in February,
although it is hard to quantify the actual impact on payrolls. It is
just as hard to determine the impact of improving weather conditions on
March payrolls, including in the weather-sensitive construction sector.

Therefore it remains to be seen whether the 15,000 gain marks a
turnaround or is just an offset of February’s bad weather, Nardone said.

But other sectors showed positive signs, with Nardone noting
payroll growth in temporary help (+40,200) and health care services,
which with 26,800 added jobs showed a “strong month.”

Manufacturing, to a lesser extent, also added to the positive March
showing, while transportation, retail and wholesale trades were little
changed.

Overall, the private sector recorded a 123,000 increase in
payrolls, the largest increase since a 127,000 gain in May 2007. And
that is on the back of net upward revisions of 62,000 for January and
February.

The positive readings in the private sector contrasted with the
ADP report, which showed a decline of 23,000 in private-sector payrolls
in March, raising questions about whether private-sector hiring has
actually turned the corner for the better.

It also contrasted with the Challenger report of an increase in
planned layoffs to 67,611 in March, although that remains sharply down
from 150,411 in March 2009. However, the increase was led by the
government sector rather than the private sector.

Despite stronger BLS employment readings, hourly earnings declined
on the month by -0.1%, giving a year-over-year increase of 1.8%, the
weakest since March 2007.

Weekly hours worked rose to 33.3 in March from 33.1 in February.
Nardone said the weather might have had an impact. Looking at the
construction sector, for instance, hours declined during the bad weather
month of February before rising again in March.

Expectations in a Market News International survey centered on a
gain of 200,000 in payroll slots with an unemployment rate stable at
9.7%.

** Market News International Washington Bureau: 202-371-2121 **

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