Jobs Stall Out in March 2012

Let's get all the good news for jobs in the U.S. in March 2012 out of the way first, shall we? Here it is, in bullet point format:

• The U.S.' official unemployment rate fell by 0.1% from the previous month to 8.2% in March 2012.


• The number of individuals Age 25 or older recorded by the BLS has having jobs in March 2012 increased by 29,000 from February 2012, reaching a total of 124,328,000, the highest level recorded since December 2008.


• If we look at the employer survey portion of the report, the net increase in manufacturing jobs over the previous month was 37,000, the largest recorded since 1984 (HT: Mark Perry), accounting for nearly 31% of the net increase of 120,000 payroll jobs.
  
  

That's pretty much all the good news in the March 2012 report. Let's look next at the household survey portion of the report to get a sense of the rest of the story, beginning with the breakdown of how the various age groups we regularly track are faring.

We see in our chart showing how the number of teens (Age 16-19), young adults (Age 20-24) and adults (Age 25 and older) in the U.S. workforce has changed since the total level of employment in the United States peaked in November 2007 just ahead of the most recent recession, that both the number of teens and young adults fell during March 2012, more than offsetting the gains of U.S. adults.

Here, we seen that the number of employeed U.S. teens fell by 36,000 from February 2012 to March 2012, with the total of 4,335,000 teens recorded as having jobs in March 2012 being 1,592,000 lower than the level recorded in November 2007. We also see that there has been no sustained improvement in the employment situation for U.S. teens since January 2011, and for all practical purposes, since June 2010 which marks the official end of the December 2007 recession.

Meanwhile, the recent trend of job gains for young adults (Age 20-24) appears to have stalled and perhaps reversed. Prior to March 2012, U.S. young adults had been a major beneficiary of the job gains that have been recorded since September 2011.

Likewise, the recent trend of improvement for U.S. adults (Age 25 and older) appears to have sharply decelerated in March 2012. Here, the large net changes recorded for this age group since October was greatly diminished, falling from the recorded month-over-month gains of 445,000 (November 2011), 200,000 (December 2011), 705,000 (January 2012, affected by the BLS' Census-related statistical adjustments) and 386,000 (February 2012).

The March 2012 jobs data would seem to confirm that the U.S. economy has indeed begun to decelerate after growing strongly, as we have been expecting. We would be seeing a very different picture for jobs in the U.S. if the economy were genuinely gaining steam across the board.

Which is perhaps why many observers, such as Reuters' Felix Salmon, were so unpleasantly surprised - the March 2012 jobs data is sharply contradicting the media's latest narrative!