Payrolls Fall 651k in February; Unemployment Reaches 8.1%l

Release Explanation: A statistic researched, recorded and reported by the U.S. Bureau of Labor Statistics intended to represent the total number of paid U.S. workers of any business. The report excludes the following employees:

The NFP impacts the Market with huge volatility because of the constant revisions to the previous reporting periods. The accompanying Employment % number tends to be much more reliable in its monthly report. The Average Hourly Earnings will add to, or contain the impact of the number of jobs created. These 3 components go to make for explosive NFP Fridays. Outside of the Interest Rate Statement, this is the most important guide for US$ Traders planning for the weeks and months ahead as the Labor Market will indicate the potential strength of future economic growth. A strong economy usually equates to a strong currency.

Trade Desk Thoughts: Nonfarm payroll employment continued to fall sharply in February and the unemployment rate rose from 7.6% to 8.1%, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.

Since the recession began in December 2007, about 4.4 million jobs have been lost, with more than half (2.6 million) of the decrease occurring in the last 4 months alone.

January’s loss was revised up to 655,000. For December, the revision was to a drop of 681,000, the most since 1949 when a huge strike affected half a million workers.

The household survey data showed the number of unemployed persons rose by 851,000 to 12.5 million last month and that over the last year, the number of unemployed persons has risen about 5.0 million and that the unemployment rate has gone up by 3.3 percentage points.

By every measure, the report is a disaster, said Matthew Carniol, chief currency strategist at TheLFB-forex.com. Some of the pressure on labor markets appears to be a byproduct of strong productivity, which is actually a big plus for the economy over the long run. But in the current environment, it seems to be making things worse for workers as nimble businesses reduce employees in anticipation of falling demand.

Among the unemployed, the number of job losers and persons who completed temporary jobs increased by 716,000 to 7.7 million in February. This measure has grown by 3.8 million in the last 12 months. The number of long-term unemployed (those jobless for 27 weeks or more) increased by 270,000 to 2.9 million in February. Over the past 12 months, the number of long-term unemployed was up by 1.6 million.

The number of persons who worked part time for economic reasons (sometimes referred to as involuntary part-time workers) rose by 787,000 to reach 8.6 million in February. The number of such workers rose by 3.7 million over the past 12 months.

About 2.1 million persons (not seasonally adjusted) were marginally at-attached to the labor force in February, 466,000 more than a year earlier. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

When marginally attached and involuntary part-time workers are included, the rate of unemployed or underemployed workers actually reached 14.8% last month, up almost six percentage points from a year earlier.

Within sectors, goods producing jobs decreased by 276k while service jobs fell 375k. Professional and business service jobs fell 180k. Jobs in education and health services increased 26k, and government jobs gained 9k.

Total weekly hours worked remained unchanged at 33.3. Average hourly earnings rose 3 cents and average weekly earnings were up $1.00.

Forex Technical Reaction: S&P futures were little changed, down 0.50 points prior to the report. The dollar weakened overnight as traders speculated on a weak number. Futures rose to a 6.50 point gain, and the dollar continued to decline against the higher-yielders.