Nonfarm employment fell 539,000 with declines in manufacturing, construction and services. While the declines were broad-based, they were smaller than we have seen recently. Aggregate hours declined again suggesting negative economic growth will persist in the second quarter. Unemployment rates indicate more household stress.

Employment Declines Signal a Bottoming

- Job declines moderated in manufacturing, construction and services. However, within the private sector, job gains remain only for the healthcare & education sector.

- Sectoral shifts in the job market are becoming evident as private sector job gains are limited to secular growth areas such as education & healthcare while actual job gains are centered in the federal government.

Unemployment up, Wage Growth Slower

- Rising unemployment rates are consistent with slower wage growth, and thereby weakness in consumer spending.

- The number of workers employed part-time for economic reasons remained extremely elevated. Many of these workers would like to work full-time but are effectively limited by their employment status in their ability to spend. This will weigh on consumer spending which we expect to be subpar this year.