Private sector sheds 23,000 jobs in March
U.S. private employers unexpectedly shed more jobs in March, dampening hopes for job growth ahead of Friday’s key employment report.
Adding to the day’s weaker sentiment, U.S. Midwest business activity expanded less than expected in March while a gauge of New York City business conditions fell, separate reports showed on Wednesday.
U.S. private employers cut 23,000 jobs in March, missing expectations for an increase in jobs although fewer than the adjusted 24,000 jobs lost in February, according to the data by a private employment service.
“It throws a little cold water on the idea we were going to be adding jobs in March, which is a little disappointing, people thought finally this might be the month,” said John Canally, investment strategist and economist for LPL Financial in Boston.
The median forecast in a Reuters poll of 82 analysts calls for payrolls to rise by 190,000 in the month, but a forecast of 20 most-accurate economists polled by Reuters is for slightly more optimistic gains of 200,000.
Job creation is considered key to keeping the economic recovery alive. A March payrolls rise would mark just the second time jobs have increased since December 2007, when the recession started.
The median of estimates from 35 economists surveyed by Reuters for the ADP Employer Services report, jointly developed with Macroeconomic Advisers LLC, was for a rise of 40,000 private-sector jobs this month.
U.S. stocks were down slightly following the ADP data, while the dollar fell against the euro and U.S. government debt prices rose.
The Institute for Supply Management-Chicago business barometer slipped to 58.8 in March from 62.6 in February. Economists forecast the index at 61. A reading above 50 indicates expansion in the regional economy.
Meanwhile, the Institute for Supply Management-New York’s seasonally adjusted index of current business conditions fell to 60.6 in March from a revised 78.1 in February. The 50 level separates growth from contraction.
In a slightly more upbeat report, the Commerce Department said new orders received by U.S. factories rose for the sixth straight month in February. The number was slightly more than expected.
Other economic data showed U.S. mortgage applications rose in the latest week for the first time in three weeks as demand for home purchase loans reached the highest level since October.