Rising wages, consumer confidence and housing demand should more than offset modest job creation in March. Besides, cutting unemployment usually gets harder as the rate falls toward 5 per cent. With the economy far stronger than a year ago, last month's numbers suggest a pause rather than peril.
The report issued on Friday showed 126,000 Americans found work in March, the fewest in any month since December 2013. The totals for January and February were reduced by 69,000.
Economic performance for the first quarter of 2015 may also turn out to be less than impressive. GDP growth is expected to slow to 1.5 per cent from about 4 per cent over the previous three quarters, according to Barclays.
Total growth for the past 12 months would, however, still be up 3.3 per cent from the same period a year earlier. What's more, wages have increased 2.1 per cent over the past year. With inflation for consumers near zero at the end of February, buying power is on the up, a rare occurrence in the past few decades. No wonder the Conference Board's consumer confidence index rose 2.5 per cent in March and is 17.2 per cent higher than a year ago.
The housing market is also getting stronger. Though construction shed 1,000 workers in March, February figures put the industry on pace to create 539,000 jobs in 2015. New home sales are up 11 per cent from the end of 2014 and 25 per cent from a year earlier. Meanwhile, the number of US foreclosures in February was the lowest since July 2006, according to RealtyTrac.
Job creation is to some extent a victim of simple math. As unemployment drops, the number of available workers shrinks, and employers find it harder to hire. In 2004 and 2005, for example, it took a year for the unemployment rate to fall from 5.5 per cent to 5.0 per cent, even as GDP growth averaged a robust 3.4 per cent. After dramatic hiring gains over the past year or so, Americans may just have to settle for steady.
The report issued on Friday showed 126,000 Americans found work in March, the fewest in any month since December 2013. The totals for January and February were reduced by 69,000.
Economic performance for the first quarter of 2015 may also turn out to be less than impressive. GDP growth is expected to slow to 1.5 per cent from about 4 per cent over the previous three quarters, according to Barclays.
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The housing market is also getting stronger. Though construction shed 1,000 workers in March, February figures put the industry on pace to create 539,000 jobs in 2015. New home sales are up 11 per cent from the end of 2014 and 25 per cent from a year earlier. Meanwhile, the number of US foreclosures in February was the lowest since July 2006, according to RealtyTrac.
Job creation is to some extent a victim of simple math. As unemployment drops, the number of available workers shrinks, and employers find it harder to hire. In 2004 and 2005, for example, it took a year for the unemployment rate to fall from 5.5 per cent to 5.0 per cent, even as GDP growth averaged a robust 3.4 per cent. After dramatic hiring gains over the past year or so, Americans may just have to settle for steady.