What the March Jobs Report Tells Us About the U.S. Economy

Although slightly below projections, nearly all industries gained ground.

Apr 10, 2014 at 11:22AM

Bad news first: Unemployment is still steady at 6.7% despite recent positive job reports. This means there are still nearly 10.5 million Americans out of work. 

But this is not because the economy is stalling. Rather, the U.S. economy is continuing to show progress and moderate expansion in the face of the recent harsh weather. Considering the economy has added an average of 170,000 jobs per month since the beginning of the year, all signs look pretty good. Unemployment is only being maintained because an increasing number of Americans who had withdrawn from the labor market due to lack of opportunity are looking once more.

True, there are still 3.7 million Americans who have been out of work for more than six months. But these people now account for 36% of total unemployment -- proportionately far lower than the levels of two years ago. Coming on the heels of Federal Reserve Chairwoman Janet Yellen's comments last week on the state of the U.S. job market, the news should be rather effective in assuaging market fears.

More good news

According to the Bureau of Labor Statistics, March saw marked increases across a number of industries. Business services expanded by 57,000 positions. On the minus side, 29,000 of these are listed in the temporary help industry; on the other hand, computer systems designs and similar information technology added over 6,000 jobs.

Despite a light fall in nursing positions, health care gained ground with 19,000 new jobs, with an additional increase of 20,000 in ambulatory health care and outpatient servicing.

Resource jobs also exploded, adding 7,000 jobs (or twice the monthly average over the last calendar year) in logging and mining. 

Finally, additional analysis has revised January and February job creation data. In both cases new job creation figures have been increased, in the case of the former by over 15,000 and over 22,000 for the latter.

Critical response

Economists are split as to how to view this recent spate of good economic behavior in the U.S. Considering the relative stability of public sector jobs, the initial reaction would seem to be that the economy is even better than data supports, since the job increases would mean an expansion of private enterprises. Coupled with the creation of nearly 200,000 positions, it looks like a fairly upbeat economic report. 

Yet, there remain a significant number of detractors who believe that the "new normal" jobs-added range is going to be between 150,000 and 200,000. This means, they say, that market analysts need to stop making such a big deal of the recent surge in economic activity. Adding that analysts are asking the wrong questions when considering job market health, though, even detractors are still tentatively positive about the economy.

Looking ahead

So far, the opening months of 2014 have been positive in the face of inclement weather and a draw-down in government investments. If data trends stay the same, then expansion will likely occur (or continue) in a number of industries. Most of these are blue collar (like mining activities support or machine manufacturing), but this is far from a defined market trend.

The technology industry should continue to expand due to recent developments (such as Microsoft's new Cortana assistant system), as should chemical manufacturing and distribution. Companies with even a moderate focus in this area (such as DuPont or Lyondell Basell) will most likely continue on current market trends, though not boom overly much. 

One area that is being overlooked by the recent jobs report is the development of green energy in the U.S. market system. Dow Chemical's recent work in developing a new photovoltaic encapsulation film, for example, should increase investment into green energy efforts further. While this may not turn into massive immediate gains financially, the event itself is noteworthy as future jobs reports might reflect this success. 

While economists may be confused about how to analyze the market, there is one thing that cannot be denied: the private sector has managed to reach (and may surpass) its 2008 peak, and that is a very good thing.

Are you ready to profit from this $14.4 trillion revolution?
Let's face it, every investor wants to get in on revolutionary ideas before they hit it big. Like buying PC-maker Dell in the late 1980s, before the consumer computing boom. Or purchasing stock in e-commerce pioneer Amazon.com in the late 1990s, when it was nothing more than an upstart online bookstore. The problem is, most investors don't understand the key to investing in hyper-growth markets. The real trick is to find a small-cap "pure-play" and then watch as it grows in EXPLOSIVE lockstep with its industry. Our expert team of equity analysts has identified one stock that's poised to produce rocket-ship returns with the next $14.4 TRILLION industry. Click here to get the full story in this eye-opening report.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers