Another Strong Jobs Report Seems To Be In The Offing

ADP calculates that there were 455,000 private sector jobs added in March, Nela Richardson, ADP’s chief economist said, “Job growth was broad-based across sectors in March, contributing to the nearly 1.5 million jobs added for the first quarter in 2022. Businesses are hiring, specifically among the service providers, which had the most ground to make up due to early pandemic losses. However, a tight labor supply remains an obstacle for continued growth in consumer-facing industries.”

The US Labor Department will release the official estimates before the stock market opens on Friday. While the ADP report can be hit or miss vs. The Labor Department’s report, it does indicate a solid March result.

ADP estimates that one of the hardest hit sectors due to the pandemic saw strong job growth in March. Leisure and hospitality’s gain of 161,000 is 35% of the total 455,000 increase.

Jobless claims continue to decline

Initial jobless claims of 187,000 for the week of March 19 were the lowest since September 6, 1969, when it was 182,000. Keep in mind that besides being over five decades ago the labor market is much larger. In 1969 there were approximately 70 million nonfarm workers vs. the current 150 million.

Continuing claims also continued to fall.

Trend of more job openings than available workers continue

With the rebound in the economy combined with the reluctance of some unemployed workers coming back and a large number of people starting their own businesses, there are many more job openings than people to fill them. The latest JOLTS report (Job Openings and Labor Turnover Survey), which is for the month of February indicates there could still be strong hiring as long as companies can find the right skilled workers.

The following graph from calculatedriskblog.com shows job openings (yellow line), hires (dark blue), layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS. When the blue line is above the two stacked columns, the economy is adding net jobs – when it is below the columns, the economy is losing jobs.

Another view of the JOLTS report from indeed.com for the past year shows the ratio of job openings to unemployed workers.