By Dees Stribling, Contributing Editor
A net of 216,000 more Americans had jobs in March than in February, and the official unemployment rate dropped to 8.8 percent during the same month. How much good news was this? Reasonably good, since the total is more (but not a lot more) than the 150,000 or so jobs the economy must create every month just to keep up with U.S. population growth.
Certainly it’s an improvement for the private sector, which added a net of 230,000 jobs in March, only a little less than in February (240,000 added) and a lot more than in January, when not even 100,000 private-sector jobs were created. The overall jobs total was less than 230,000 in March because about 14,000 government jobs–mostly local government jobs–disappeared during the month. Among business sectors, professional and business services, including temporary workers, added 106,800 positions (28,800 of those were temps), and the always-growing healthcare industry added 44,500. Construction lost 1,000 jobs, but education lost more: 6,400.
The broadest measurement of unemployment–known to economy wonks as U-6–includes discouraged, marginally attached workers and people in part-time jobs who want full-time ones, and the U-6 rate dropped from 15.9 percent in February to 15.7 percent in March. So that’s reasonably good news as well. But perhaps the best news is what didn’t happen. Despite international brouhaha and an annoying spike in gas prices, businesses didn’t psyche themselves out of hiring the workers they needed.
Construction spending takes dip
It’s hardly any surprise anymore when U.S. construction spending declines, but that doesn’t make it any easier for the businesses and labor markets most dependent on construction. According to the U.S. Census Bureau on Friday, total construction spending in February dropped 1.4 percent month-over-month, and 6.8 percent year-over-year.
At an annualized rate of $760.6 billion in February, that total is the worst monthly one for construction spending in 11 years. Leading the drop was private residential construction, which was down 3.7 percent compared with the previous month. Single-family home building lost 1.7 percent, and multifamily residential building dropped 1.5 percent.
Public building projects also lost steam during February, with state and local construction outlays down 1.5 percent in February compared with the previous month. Federal spending, however, inched up by 0.7 percent.
Paul says Fed lending to foreigners bad idea
Rep. Ron Paul (R-TX) is planning more U.S. House hearings about the Federal Reserve, an institution he would like to see go the way of the First and Second Banks of the United States. This time the anti-central-bank Paul wants to take the Fed to task for lending money to non-American banks during the international credit panic in the fall of 2008, a fact that was revealed just last week.
“These lending activities provided no benefit to American taxpayers, the American economy, or even directly to American banks,” goldbug Paul asserts in a statement, presumably longing for a time when international financial markets weren’t as closely linked as they are now. (Though in a Ron Paul world, everyone would pay really close attention to the worldwide demand for the chemical element Au.)
Under the theory that the world economy is pretty much one big boat, the Fed’s policy for lending from its discount window is that any lawful financial institution is welcome to borrow, provided it has some collateral. It’s also Fed policy to make money off these loans, which it did on the 2008 loans–a profit that went to the U.S. Treasury. All together in 2010, the Fed’s profit from all of its activities was about $82 billion.
Wall Street scored a modest up day on Friday to go along with the pretty good employment news, with the Dow Jones Industrial Average gaining 56.99 points, or 0.46 percent. The S&P 500 rose 0.5 percent, and the Nasdaq advanced 0.31 percent.