–NFIB Econ Says Employers Intend on Creating Less Jobs in April
By Ian McKendry
WASHINGTON (MNI) – The U.S. March employment report released Friday
showed the economy is improving, but fundamental challenges will
continue to make the economic recovery an uphill battle, economists say.
“The challenging factor is that the population grows,” Labor
Department Chief Economist Betsey Stevenson, said in a conference call
with reporters.
The unemployment rate has fallen a full percentage point over the
past four months — falling from 9.8% to 8.8% but the labor force
participation rate has remained relatively unchanged hovering at the low
rate of 64% the past three months.
Stevenson said the household survey indicates that 1.4 million more
people are employed today than last year, but the population grew by 2.2
million people — essentially negating the increase in employed persons.
“It’s as if a year’s worth of typical new entrants in the labor
market just didn’t arrive,” Stevenson said, adding that it will be a
challenge to keep up with population growth as well as getting the
unemployed back to work.
Stevenson said another concern is the $0.02 decrease in hourly
earnings despite inflationary worries with rising food and energy costs.
She said wages actually have been consistent with prices — just
not with some commodities such as food and oil which are much more
volatile than wages.
Despite the labor force participation rate remaining at a low level
and average hourly earnings decreasing two cents, the March employment
report was mostly heralded as another sign that the economy is on the
way up.
Austan Goolsbee, chair of the White House Council of Economic
Advisers, said “The last two months of private job gains have been the
strongest in five years.” He added that the trajectory of the economy
has “improved dramatically” over the past two years.
William Dunkelberg, chief economist for the National Federation of
Independent Business, said the number of net new jobs reported on Main
Street was decidedly positive,” adding “employment gains have not been
this good since 2007.”
However, Dunkelberg sounds a cautionary note in his statement,
saying the closely watched NFIB monthly survey which will be released
April 12, indicates as a percentage, less employers intend on adding new
jobs in April.
“Unfortunately, the net percent of owners planning to create new
jobs (increasing the total number of workers employed) lost three
points, falling to a net 2 percent of all firms,” Dunkelberg said.
On the upside, Dunkelberg said despite the decrease in firms
intending on adding new jobs, the index is still 12 points above its
March 2009 level of -10%.
“The positive job creation observed in February was repeated again
in March,” Dunkelberg said
** Market News International Washington Bureau: 202-371-2121 **
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