“Job creation in March was less than expected, and February’s number was revised downward to 243,000,” acknowledged Huether. “But we’ve now experienced 22 consecutive months of job growth and that has to be seen as positive.”
Huether said that manufacturing actually lost 8,000 jobs last month after adding 15,000 in February. “Modest job gains in fabricated metals, machinery and non-auto transportation were more than offset in March by losses in motor vehicles, apparel, textiles and furniture,” he reported.
“During the past year, machinery, metals, computers and other sectors closely tied to the recovery in business investment have expanded payrolls,” explained Huether. “Sectors shedding jobs are those still facing stiff import competition, particularly from Asia where currency manipulations keep many countries’ currencies low against the dollar. This is why the NAM considers it critical for the Administration to continue pressing various trading partners to remove their currency controls.”
Shifting gears, Huether noted that average weekly and hourly earnings for both production and non-supervisory workers edged up just 0.3 percent last month and have increased only a modest 2.6 percent during the last 12 months.
“The labor market has not tightened enough to warrant concerns about wage-driven inflation,” Huether continued. “This should give the Federal Reserve pause when it considers interest rate policy at its next FOMC meeting in early May. Today’s report clearly shows that the economy is not overheating. And with energy prices accounting for an increasing chunk of consumer and corporate spending, now is not the time to raise interest rates.”
Separately, the Institute for Supply Management today released its March report on manufacturing. Its overall PMI index remained basically unchanged at 55.2. “With manufacturing’s production holding steady and orders actually accelerating, today’s news suggests both orders and production will remain solid in the second quarter,” concluded Huether.