Apr 04 - The overall jobs picture continues to improve, but one key component, average hourly earnings, went in the wrong direction, and could give the Fed another reason to hold off on raising rates. Bobbi Rebell reports.
The job market is getting better. Those winter storm blues fading away a bit. 192,000 new jobs were created in March; January and February revised upwards by a total of 37,000. The unemployment rate remained unchanged at 6.7 percent. Private sector jobs back to pre-recession levels from 2008 and on a good trajectory. Wells Fargo's Brian Jacobsen: SOUNDBITE: BRIAN JACOBSEN, CHIEF PORTFOLIO STRATEGIST, WELLS FARGO ADVANTAGE FUNDS (ENGLISH) SAYING: "We have construction employment, which is still just a fraction of where it was at the previous peak in January of 2008, but other areas like healthcare, temporary health care services, those are above and beyond where they were when we first were, the previous peak. So there is still a lot of work to be done. And that is why the market is going to continue to rally on this type of news, is because we are seeing that even though the headline says that we are back to where we were, there is actually a lot more growth coming in those other areas that are just beginning now to catch up." And in fact more Americans are in the workforce- participation is at a six-month high, And they are working more hours. The average work week up to 34.5 hours. Both show confidence in the job market- as the weather improves. Council of Economic Advisor's Chairman Jason Furman: SOUNDBITE: JASON FURMAN, CHAIRMAN, COUNCIL OF ECONOMIC ADVISORS (ENGLISH) SAYING: "I think you see the weather more if you look at the number of hours that were up 2-tenths of an hour, up 4-tenths of an hour in manufacturing. I think that really reflects that a lot of people missed some work last month that they were able to do this month." But hold the champagne: Americans are not making more money. Average hourly earnings actually went down by a penny. Reuters columnist James Saft: SOUNDBITE: JAMES SAFT, REUTERS COLUMNIST (ENGLISH) SAYING: "It's disappointing because we had seen some decent wage growth last couple of months. But that does not seem to have carried through. I mean, in a lot of ways that was probably the most significant figure here because if we saw some wage growth there would be evidence that the Fed might believe that it would show we are getting pressure in some bits of the skilled economy. Even though there is still a lot of long term unemployed, and not much seems to be improving for them- if we saw a good wage growth we might get some inflationary pressure. " No surprise then that the markets cheered the report- a better jobs picture- but with some important vulnerabilities- likely keeping the Fed on the sidelines when it comes to raising rates.