Search ForexCrunch

Alvin Liew at UOB Group’s Global Economics & Markets Research assessed the latest US NFP figures.

Key Quotes

“The US economy ended its 113 consecutive months of employment creation (since October 2010) with a huge loss of 701,000 nonfarm payroll (NFP) jobs in March… This was a significant deterioration of US jobs market when compared to the recent ADP report which saw just 27,000 job losses (it did not include bigger job losses that occurred later in the month, so we may see this ADP figure revised much worse in the April report). Job creation in February was revised slightly better to 275,000 (from 273,00 previously) but there was a significant 59,000 downward revision to the January jobs data to 214,000 (from 273,000).”

“The private sector was fully responsible the US jobs losses with 713,000 while the government added some 12,000 new jobs (from +33,000 in February) due to hiring of workers for 2020 Census exercise.”

“The top three services-providing employment that had driven job creation in the recent past are now the worst hit sectors by the early effects of the coronavirus disease (COVID-19) pandemic on the US labor market. Of the three sectors, leisure & hospitality bore the disproportionate brunt of the COVID-19 impact with 459,000 job disappearances, mainly in food services and drinking places (-417,000 which nearly wiped out all its jobs gains from the last 2 years in a single month!). The next was health care & social assistance which saw employment fall by 61,000) and followed by professional & business services (-52,000) of which losses were in temporary help services (-50,000).”

“US unemployment rate jumped to 4.4% in March (from 3.5% in February) in line with the significant job losses. That said, the unemployment rate increase was cushioned by the marked easing of the labor participation rate which tumbled by 0.7ppt to 62.7% (from 63.4% in February) as 1.6 million exited the labor force.”