The struggling U.S. economy probably continued to bleed jobs at a rapid rate in March, continuing to drive up the jobless rate at a startling pace.
Forecasters polled by Reuters expect nonfarm payrolls to register a decline of 650,000 for March, similar to the 651,000 shed in February. The 78 estimates ranged from down 522,000 to down 750,000 jobs.
The jobless rate is forecast at 8.5 percent, up from 8.1 percent in February, when the rate unexpectedly surged from 7.6 percent.
Layoffs continue at a record pace, although they are no longer accelerating, said Chris Low, chief economist at FTN Financial in New York.
Many industries, from technology and electronics to airlines and retail, remain under pressure to rein in expenses and limit overhead.
Continue Reading Below
Economists have started to see some green shoots in the U.S. economy after a long, bleak few months, but the labor market, a lagging indicator, is likely to be one of the last places where an improvement is seen.
Companies will need to see stronger evidence of a sustained slowing in the rate of contraction in demand before the drop in payrolls will slow, said Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, New York.
The unemployment rate has been climbing faster than in any recession since 1980, and has already surpassed the peaks of the 2001 and 1990 downturns. An 8.5-percent rate would match the level last seen in November 1983.
Federal Reserve officials have suggested that the jobless rate will keep climbing into 2010 even if at least a mild recovery catches hold in the second half of 2009.
On Wednesday, a report from ADP Employer Services showed that U.S. private-sector employers slashed 742,000 jobs in March, a record since the survey was started in 2001 and up from a revised decline of 706,000 in February.
The payrolls report is due at 8:30 a.m. EDT on Friday. Following are some analysts' comments and forecasts:
ECONOMISTS AT BARCLAYS CAPITAL:
(Forecast: payrolls, -675,000; jobless rate, 8.6 pct)
The claims data point to further distress in the labor market: both initial and continuing claims are above February levels on a month-average and survey-week basis, and the insured unemployment rate climbed higher. We look for these depressed conditions to keep average hourly earnings subdued, and to push the average work-week to a new record low of 33.2.
STEVEN WOOD, ECONOMIST, INSIGHT ECONOMICS:
(Forecast: payrolls, -650,000; jobless rate, 8.5 pct)
Payroll employment fell sharply in March for the seventh consecutive month. This substantial loss of jobs has been presaged by the lofty level of initial claims and the soaring number of continuing claims for unemployment insurance.
The average work-week remained at its cyclical and secular nadir, with the risk of slipping slightly further. Hourly earnings remained weak, given the substantial slack in the labor market.
DAVID SLOAN, ECONOMIST, 4CAST LTD:
(Forecast: payrolls, -635,000; jobless rate, 8.4 pct)
Most components of the breakdown should look fairly similar to February. Construction may see a deeper loss with weather less supportive, but job losses in business and professional are unlikely to match a very steep February fall. Government should rise by 5,000, leaving the private sector down 640,000.
Manufacturing job losses are unlikely to repeat the very steep 259,000 loss of January, when autos adjusted to sharply lower first-quarter output plans. A 175,000 decline would be similar to those seen in December and February.
Some recent data is suggesting that the pace of contraction in the economy has passed its peak.
(Polling by Bangalore Polling Unit; Editing by James Dalgleish)