Payrolls are always volatile even at the best of times and we are coming off a run of almost unbelievably strong employment growth stretching back to last summer. All the other labour market indicators suggest that labour market conditions are still very strong: initial jobless claims are unusually low, the job openings rate is near a record high and the employment indices in the various activity surveys are at robust levels. Accordingly, this is most probably another temporary blip, like the ones we saw in mid-2012 and late 2013. Payrolls still increased by an average of 250,000 over the past six months and 200,000 over the past three months. Even the latter is enough to keep the unemployment rate on a downward trend. “The well below consensus 126,000 increase in non-farm payrolls in March, particularly when combined with the 69,000 downward revision to earlier gains, will raise fears that the labour market is imploding. It isn’t.” – noted Capital Economics in its report on Friday
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