Employers added a disappointing 126,000 jobs in March

You don’t want to read too much into a single monthly jobs report, but there’s no denying that the latest news from the Bureau of Labor Statistics was disappointing. Employers added a meager 126,000 jobs, and the previous two months’ worth of reports got downward revisions. It’s not time to panic yet, but one lesson from the weak month ought to be that talk of an early interest-rate hike from the Federal Reserve is misguided and that the palpable desire of some stakeholders to raise rates at the first sign of bad news is itself a source of trouble.

The construction sector took a notable turn for the worse, as developers apparently slowed their interest in new projects.

Nonfarm employers added a disappointing 126,000 jobs to their payrolls in March, well under consensus estimates of 247,000. The unemployment rate also held steady at 5.5 percent, the Labor Department reported Friday. It’s an unusually dismal report, so we’ve broken down what’s so bad about it and even found some of the good nuggets:

Wages went up. Average hourly earnings grew by 7 cents, with the year-over-year growth standing at 2.1 percent. That’s not stellar performance — it’s roughly in line with recent months’ wage growth — but it’s good that wages didn’t stay flat or fall while job growth also slowed. Higher wages are one sign that slack is diminishing and that employers are starting to have to pay workers more.

On Friday, we’ll get the latest estimate of job growth from the government, and it’s expected to be another solid report. Consensus estimates are that nonfarm employers added 247,000 jobs in March, according to Bloomberg News, with the unemployment rate holding steady at 5.5 percent. That would be slightly fewer than the prior month’s 295,000 and just below the last 12 months’ average payroll growth of around 275,000.

There are three key areas to watch in tomorrow’s report, and they are the same job market indicators we have come to scrutinize closely in recent months: