AFMC - U.S. Jobs Report Hints At A Gradual Cooling Despite A Strong Headline
2024-03-08 10:20:00 ET
Summary
- US nonfarm payrolls rose 275k in February, but big downward revisions, weak wages and rising unemployment suggest things are not quite as robust as the headline indicates.
- Moreover, lead indicators are clearly weakening and a slowdown looks to be on the way.
- It's not enough for the Fed to relax just yet, but we think things will be in place for a June rate cut.
Big jobs number, but big downward revisions too
The US jobs report always throws up surprises, and we have quite a lot in this report for February. Nonfarm payrolls rose 275k, above the 200k forecast, but there were 167k of downward revisions to the past two months, so the net improvement was little more than 100k. The revisions recently have been huge - remember last month we got 126k of upward revisions. This highlights how unreliable the data collection is and why we should really focus on a range of labour market indicators rather than this single payrolls number alone....
U.S. Jobs Report Hints At A Gradual Cooling Despite A Strong Headline