2010 Economic Calendar
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Employment Situation  
Released On 3/5/2010 8:30:00 AM For Feb, 2010
PriorPrior RevisedConsensusConsensus RangeActual
Nonfarm Payrolls - M/M change-20,000 -26,000 -50,000 -150,000  to 30,000 -36,000 
Unemployment Rate - Level9.7 %9.8 %9.6 % to 10.0 %9.7 %
Private Payrolls - M/M change-18,000 -18,000 
Average Hourly Earnings - M/M change0.2 %0.2 %0.2 %0.1 % to 0.2 %0.1 %
Nonfarm Payroll - level129.527 millions

Severe weather in February did not have as much impact on jobs numbers as feared. But government layoffs are now weighing on the numbers. Nonfarm payroll employment in February declined 36,000, following a revised 26,000 decrease in January and revised fall of 109,000 for December. The February payroll decline was less negative than the market forecast for a 50,000 fall in employment. The January and December revisions were up a net 35,000.

Weakness in February was led by a 64,000 drop in construction jobs. Rounding out the goods-producing sector, manufacturing actually edged up 1,000 and mining rose 4,000. Service-providing jobs were up 42,000 in February, following a 20,000 increase the month before. The highlight was temp help being up 48,000 in the latest month. Government jobs fell 18,000 despite the hiring of 15,000 temporary Census workers. At the federal level, the U.S. Postal Service cut 9,000 jobs. Local governments shrank their work forces by 31,000 in the latest month.

On the issue of snow storms potentially lowering payroll jobs, the Labor Department made a point to include a special memo that stated that workers are counted as employed for the month if they receive pay for any portion of the pay period-for example, even just one hour. So, even if workers had fewer hours, they were still counted as employed. Hence, the impact of the snow storms likely was exaggerated headed into the report.

On a year-ago basis, payroll jobs improved to minus 2.5 percent in February from minus 3.0 percent in January.

From the household survey, the unemployment rate held steady at 9.7 percent in February.

Wage inflation in February eased to an anemic 0.1 percent rise from 0.2 percent the month before. The consensus had expected a 0.2 percent gain. The average workweek (traditional series for production & nonsupervisory workers) slipped to 33.1 hours in February from 33.3 the month before. One of the biggest negatives in the report is a drop in the manufacturing workweek to 39.5 hours from 39.9 in January (traditional series).

It's hard to really determine the direction of momentum this month given the heavy snow storms. However, two divergent movements stand out. The rise in temp help is good news but the drop in local government and USPS employees may portend more job cuts within government. Equities traders, however, see the report as positive and futures are up. Rates firmed on the news.

Consensus Outlook
Nonfarm payroll employment in January fell a modest 20,000, following a 150,000 drop in December and gain of 64,000 for November. The January decline was led by a 60,000 drop in the goods-producing sector which included a 75,000 decrease in construction. The service providing sector rebounded 48,000 after dropping 69,000 in December. Wage inflation in January edged up to a 0.2 percent increase, following a 0.1 percent gain the month before. From the household survey, the unemployment rate declined to 9.7 percent from 10.0 percent in December. Based on a recent worsening in initial jobless claims, many analysts are expecting a larger dip in payroll jobs in February even though temporary hiring for the Census will add significantly. Severe snow storms are expected to dampen jobs also. Similarly, the unemployment rate is projected to rise also in part due to a technical rebound from January's atypically large decline.

The most closely watched of all economic indicators, the employment situation is a set of monthly labor market indicators based on two separate reports: the establishment survey which tracks 650,000 worksites and offers the nonfarm payroll and average hourly earnings headlines and the household survey which interviews 60,000 households and generates the unemployment rate.

Nonfarm payrolls track the number of part-time and full-time employees in both business and government. Average hourly earnings track employee pay while the average workweek, also part of the establishment survey, tracks the number of hours worked. The report's private payroll measure excludes government workers.

The unemployment rate measures the number of unemployed as a percentage of the labor force. In order to be counted as unemployed, one must be actively looking for work. Other commonly known data from the household survey include the labor supply and discouraged workers.  Why Investors Care
During the mature phase of an economic expansion, monthly payrolls gains of 150,000 or so are considered relatively healthy. In the early stages of recovery though, gains are expected to surpass 250,000 per month.
Data Source: Haver Analytics
The civilian unemployment rate is a lagging indicator of economic activity. During a recession, many people leave the labor force entirely, so the jobless rate may not increase as much as expected. This means that the jobless rate may continue to increase in the early stages of recovery because more people are returning to the labor force as they believe they will be able to find work. The civilian unemployment rate tends towards greater stability than payroll employment on a monthly basis. It reveals the degree to which labor resources are utilized in the economy.
Data Source: Haver Analytics

2010 Release Schedule
Released On: 1/82/53/54/25/76/47/28/69/310/811/512/3
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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