As Expected, A Bad Employment Report

The economy shed 652,000 jobs in February. The unemployment rate jumped to 8.1% and the augmented rate hit 14.8%.

Here are a few comments from economists on the Wall Street Journal Real Time Economics blog:

  • Job declines were widespread with losses in manufacturing and construction. The only bright spots remaining are health care & education, which reflect demographic trends. In contrast to the broad trend of declines in the private sector, government employment continues to grow. This suggests a change in the composition of the job market and economy. –John Silvia, Wachovia Economics Group
  • Sharp, broad-based job losses continued into February, compounded by net downward revisions of 161,000 to December-January tallies. Manufacturing industries, which make up only 12.5% of private sector employment, accounted for 30% of the 2 million jobs shed from nonfarm payrolls over the past three months. For those looking for any signs of “second derivative” stabilization — in which the rate of decline stops increasing — nonmanufacturing employment offers a glimmer. The pattern of job loss has been relatively stable since November, and rising productivity suggests that this pace of job losses may prove sufficient to restore profitability. –Alan Levenson, T. Rowe Price
  • Horrendous! There can be no other word to describe this employment report. Adding in the revisions to December and January, there are more than 800,000 fewer jobs in February than were previously reported for January, while the unemployment rate is higher than at any time since December 1983. Unfortunately, the weekly jobless claims data suggest more of the same is coming for March. It appears that the economy is contracting at a 6% or so pace in the first quarter following a 6.2% drop in the fourth quarter. It is unlikely to be long before we hear calls for more stimulus in Washington. –RDQ Economics
  • While some of these economists see a bit of sunshine, it’s hard not to feel as if they’re grasping at straws.

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