NFP: Jobs report is old news – Wells Fargo
Data released on Friday, showed the US economy added 273K jobs in February. According to analysts at Wells Fargo, the bright state is unlikely to last.
“The February employment report covered the week ending the 15th, so before concerns over COVID-19 escalated. But before the recent volatility in financial markets and steppedup efforts to contain the virus, the labor market was on solid ground.”
“As with last month, the unseasonably mild winter weather appears to have given some lift to hiring.”
“Even before accounting for the coronavirus outbreak, payroll growth exCensus workers looks poised for a sharp slowdown in March.”
“The Fed is already looking ahead to the ripple effects of efforts to contain COVID-19, so today’s report does not change our assumption for additional easing before the end of Q2. Hiring was resilient through the past two growth scares of the current cycle. But those scares—triggered by uncertainty over trade policy (2019) and commodity prices collapsing (2015-2016)— were centered around goods-producing industries.”
“The COVID-19 environment stands to impact hiring in the service sector much more directly, in addition to dealing another blow to the manufacturing and mining industries. Delayed shipments, canceled travel and forgone outings are ripe to reduce hiring in the months ahead.”