Was February a fluke, or the future? Companies added just 20,000 jobs in February. It marked the slowest month of hiring since Hurricanes Harvey and Irma hit the U.S. and hurt job growth in the fall of 2017.
March employment data is due Friday in the week ahead. Expectations are that the American economy added 175,000 jobs last month. It would represent a return to an average rate of employment growth. Watch for revisions to the February data as well.
When the February number was first released, the White House called it "fluky." Hiring in construction, hospitality and retail was down or flat. It was a weird snapshot, considering U.S. companies had been adding jobs like crazy in previous months, including 311,000 in January.
During the week in March that the government collected data from companies on new jobs, first-time filings for unemployment benefits fell _ a sign companies aren't eliminating work. It also suggests interested and available workers are finding job opportunities.
This is in spite of little doubt the American economy slowed in the first quarter. The Federal Reserve Bank of Atlanta's GDPNow model predicts 1.5 percent growth over the first three months of the year. A separate forecast at the New York Federal Reserve Bank expects the economy added 1.3 percent between January and March. Both represent a meaningful drop from the 2.2 percent annual growth rate the economy experienced at the end of 2018.
This is reflected in the quick changes the Federal Reserve has made to its interest rate outlook. Less than four months ago, the Fed predicted it would raise its target short-term interest rate twice this year. Now? The Fed doesn't expect to raise rates at all this year.
Google searches for "recession" have increased, but long-term investors know not to confuse Internet searches for economic fundamentals. Job growth is a key piece of the puzzle.
