The economy added only +20k jobs in February, far short of the +180k expected. The result was a combination of: a payback from very strong growth in the prior two months; an error band of +/-100k; bad weather cutting construction by -30k, the biggest loss in over eight years; and a weaker economy. The entire services sector gained only +53k jobs vs a 12-month average of +166k. A payback from the end of the government shutdown dropped the unemployment rate from 4.0% to 3.8% and cut the underemployment rate from 8.1% to 7.3%. Wages gained +0.4% m/m to +3.4% y/y, the highest in almost 10 years. The weakness in job creation plus the increase in wages suggest that employers are trying to lure people into jobs, but can’t find the right people to hire. January retail sales rose +0.2% m/m, but December was revised down from -1.2% m/m to a terrible -1.6% m/m. Sales are growing +2.3% y/y, while core sales are up +2.7% y/y, less than half the pace six months ago.
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Weekly Export Risk Outlook 13 March 2019