Feeling a bit like Charlie Brown as we await Friday’s jobs report, we are forecasting very strong job gains in March, capping a solid quarter overall for the nation’s labor market. But if this feels like deja vu all over again, it’s because we’ve been here before. In fact, over the past 3 years, the economy began each year with strong job gains only to see the labor market weaken over the subsequent 3 quarters of the year. In only 1 of the 9 quarters following the 1st (Q4 ’11) did job gains exceed the high-water market set in that year’s 1st quarter.
And so here we are again. Based on our data from February in which new and total job openings in LinkUp’s job search engine (which indexes 2 million jobs from 50,000 corporate websites) rose 5.5% and 5.7% respectively, we are forecasting that a net gain of 275,000 jobs were added to the U.S. economy in March. Not accounting for any potential BLS revisions, that would result in Q1 job gains of 579,000 – not quite as solid as 2012 or 2013, but substantially better than 2011.
Unfortunately, in each of the 3 years between 2011 and 2013, the labor market slowed markedly in the 2nd quarter, with job growth declining an average of 40% from the 1st quarter. In 2012 the drop was particularly horrific, with job gains dropping from 677,000 in Q1 to a miserable 200,000 in Q2.
But just like good Ol’ Charlie Brown, we remain hopeful that this time maybe, just maybe, things will be different. Maybe this time, Lucy won’t pull the ball away from us at the last minute. Maybe this year is truly the ‘gear year’ as Jim Paulsen calls it. If our data from March is any indication, at least April should kick off Q2 with very strong job gains.
In March, new job listings on company websites rose by 18%, while total job listings rose by 8%. Even more encouraging, new and total job listings rose in all 50 states.
Similar growth was seen in new and total job openings by category, with new listings rising 20% from February and total listings climbing 8% from the prior month. Increases occurred in 30 of 31 job categories tracked by LinkUp with new openings in Oil, Gas, & Utilities as the only decline.
With the blended average gain of 5.6% in new and total job listings seen in February and the 4.3% seen in March (which is different than the data tables for March shown above due to our paired-month methodology), we are forecasting net job gains of 275,000 for March and our preliminary forecast for April is a net gain of 325,000 jobs.
Let’s hope we’re not being a blockhead about the outlook.