Job Growth at Mediocre 139K; Beige Book Talks of Winter’s Impact
- Mar 06, 2014
Automated Data Processing said on Wednesday that the U.S. private sector created 139,000 jobs in February, the third weak total in three months, and well below the average of the last 12 months. The net increase in jobs was concentrated in professional and business services, trade and transportation, and to a lesser extent, construction, according to ADP. Manufacturing added only 1,000 new positions.
Once again, small businesses – fewer than 50 employees – contributed the most new jobs, the company says, adding a net total of 59,000, though larger businesses (500 workers or more) added a fair number of positions, 44,000. Mid-sized businesses (50-499 employees) added 35,000 jobs during February.
Economists are finally acknowledging the weather by predicting that when the official February employment numbers are published by the Bureau of Labor Statistics on Friday, they too will be fairly weak — as they were in December and January — owing in some part to the hard winter. An increase of roughly 150,000 jobs is the consensus for February.
Beige Book Also Talks of Winter’s Impact
The Federal Reserve released the latest “Summary of Commentary on Current Economic Conditions by Federal Reserve District,” a.k.a., the Beige Book, on Wednesday. The book noted that most of the 12 Federal Reserve districts reported expanding economic conditions from January to early February, albeit “modest to moderate” expansion. New York and Philadelphia experienced a slight decline in activity, which was mostly attributed to the unusually severe weather experienced in those places.
Indeed, the Beige mentioned the weather as a factor in the economy 119 times, and in all of the district reports. In the January Beige Book, by contrast, weather rated a mention only 21 times, and in the March 2013 Beige Book, the weather came up only 18 times.
Weather had an impact on CRE as well, according to the Fed. Most districts said that commercial real estate activity had increased and that conditions continued to improve since the previous report, but “Philadelphia noted that there was very little activity to report in construction or leasing due to severe winter weather.” The outlook for nonresidential construction was fairly optimistic all the same, especially in the following districts (which of course includes more territory that the cities they’re named after): Boston, Philadelphia, Cleveland, Atlanta, Minneapolis, Kansas City, Dallas, and San Francisco.
Wall Street ended the day mixed on Wednesday, with the Dow Jones Industrial Average dropping 35.7 points, or 0.22 percent, while the S&P 500 edged down a mere 0.01 percent. The Nasdaq gained 0.14 percent.