Investors should start readying themselves for some strong gains in the labor market.
Why?
Its because both data and anecdotal evidence point in that direction, at least for a while.
We are going to be hiring this year, said Joe Brusuelas, of Stanford-based economic research firm Brusuelas Analytics. He pegs the likely gain in payrolls at around 225,000 for March, up from a loss of 36,000 in February.
Heres the evidence:
In the first place, the government has started hiring large numbers of temporary workers for the census. That number should peak at around 635,000 in May, according to the Commerce Department. The jobs will be temporary, but they are still jobs and that will likely mean increased spending in the economy and hence likely more hiring.
Even without the census-related boost, Brusuelas said the private sector should add about 50,000 permanent jobs a month if the economy stays on its current trend. That trend-growth rate should edge higher towards the end of the year, with even more jobs being added each month, he said.
Add to that further evidence hidden deep with other data series. Even though the Institute for Supply Managements Manufacturing Index, which tracks growth in the factory sector, slowed in February, the sub-index for employment was more bullish, showing three months of steady increases.
The employment sub-index within ISMs Services Index, which tracks the non-manufacturing economy, also showed consistent gains over the same period. The two ISM data points augur improved hiring going forward. ...
