In the US, employment dropped by 663 000, very close to the consensus estimate of 663 000. The February figure stayed unchanged, but the January outcome was sharply downwardly revised from -655 000 to -741 000. Looking at the details, 305 000 jobs were lost in the goods-producing sector, of which 161 000 in manufacturing. Employment dropped by 358 000 in the service providing sector and the government lost 5 000 workers. The civilian labour force dropped somewhat from 154.21 m to 154.05 m, while the number of people unemployed rose from 12.47 m to 13.16 m. The unemployment rate rose sharply from 8.1% to 8.5% in March, the highest number since November 1983. Temporary help agencies, that often lead overall payrolls changes, dropped by another 72 000 (from -77 000), while education and health, non cyclical sectors, added 8 000 jobs (from 22 000). Average weekly hours worked dropped slightly to 33.2 (from 33.3). This is the fourth consecutive month that payrolls dropped by more than 650 000 and for the coming months, labour market conditions are expected to remain weak as temporary help is still dropping sharply.
The ISM non-manufacturing index surprised on the downside of expectations in March, falling from 41.6 to 40.8, while a slight improvement was expected. Business activity (44.1 from 40.2) and backlog of orders (41.0 from 36.5) improved significantly, but also the inventory change rose somewhat. The decline in the headline index was due to a drop in new orders (38.8 from 40.7), inventory sentiment (60.0 from 66.5), employment (32.3 from 37.3) and imports (37.0 from 39.0). The decline is a bit disappointing and indicates that sentiment is again deteriorating after improving in December and January.
EMU: services confidince upwardly revised in March
In March, the final figure of services PMI showed a slight upward revision compared to the first estimate. The headline index was upwardly revised from 40.1 to 40.9, while no change was expected.
Other: UK services PMI shows fourth straight increase
In the UK, services PMI surprised on the upside of expectations in March. The index rose from 43.2 to 45.5, while only a marginal improvement was expected. Improvements were seen in new business (44.1 from 42.5), outstanding business (40.4 from 38.7) and business expectations (58.7 from 56.8). Both input prices and prices charged were rising. This is the fourth consecutive rise in services PMI and together with the improvements in manufacturing and construction confidence, this indicates that sentiment is improving somewhat in the UK.
