Tags: Census | Hiring | March | Payrolls

Census Hiring to Lift March Payrolls

Friday, 02 Apr 2010 07:15 AM

 

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WASHINGTON - U.S. non-farm payrolls, a key measure of the economy's health, probably rose in March for only the second time since recession struck in late 2007 as hiring for the 2010 U.S. Census added jobs.

A bounce-back from February's weather-related losses is also expected to help lift the government's closely watched employment count, which will be released at 8:30 a.m. on Friday.

The labor market has lagged the economy's recovery from the worst downturn since the 1930s, creating a political challenge for President Barack Obama.

Job growth is critical to keeping alive the recovery, which started in the second half of 2009, once government stimulus efforts and a boost from businesses' rebuilding inventories fade.

"Employment growth is the last piece of the puzzle. We need job growth and labor income growth in order to have a sustainable economic recovery," said Zach Pandl, an economist at Nomura Securities International in New York. "We have haven't seen that yet, but we are on the cusp of a hiring recovery."

A Reuters survey of economists forecast a gain of 190,000 jobs in March after February's drop of 36,000. The median projection from the 20 economists who have forecast payrolls most accurately over the past year predicts 200,000 jobs were created last month.

The unemployment rate was seen holding steady at 9.7 percent for the third straight month. Given the distortions from the decennial census, analysts said the focus should be on private payrolls to get a clear picture of the labor market.

Private payrolls fell by 18,000 in February, but a gain is expected in March.

With 8.4 million jobs lost since December 2007, Obama is under pressure for solutions to put Americans back to work.

Obama and his fellow Democrats fear voter anger over high unemployment could cost the party its control of both the Senate and the House of Representatives in November elections.

"The employment report will likely show an increase in payrolls, but that won't change the basic fact that unless policymakers take bold action, all key signs point to a very long, very slow recovery for jobs," said Heidi Shierholz, an economist at the liberal Economic Policy Institute in Washington.

U.S. stocks have rallied from their recent low of February 8, partly on expectations that March would mark a significant turnaround for the labor market.

The stock market will be closed for Good Friday, but the government bond market will be open for an a shortened session and foreign exchange markets expect thin volume after reacting to the data.

Analysts reckon the state of the job market will determine when the Federal Reserve will start raising benchmark interest rates, which are currently near zero.

The U.S. central bank has promised to keep overnight rates ultra low for an extended period, citing subdued inflation and the likelihood the economic recovery will be moderate.

Construction, manufacturing and retail payrolls -- hit by severe snowstorms in February -- will likely see improvements in March. The Labor Department's survey of businesses, from which the payrolls number is derived, counts as unemployed any worker who was not paid during the pay period covered by the survey.

The snap back from weather-related losses should also see a modest lengthening in the average work week for all employees, which had slipped to 33.8 hours in February.

© 2014 Thomson/Reuters. All rights reserved.

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