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Jobs report mixed prior to sequester

Keywords: Tags  employment statistics, metals industry, automotive, machinery building, economists, Nigel Gault, Jared Bernstein, IHS Global Insight Center on Budget and Policy Priorities




CHICAGO — Primary metal producers shed 2,900 jobs in February, with employment dipping 0.7 percent, following the loss of only 100 jobs in January, U.S. Bureau of Labor Statistics data show.

Metal fabrication shops added 5,600 people to their payrolls in February, more than making up for a headcount reduction of 4,900 in January, the not-seasonally-adjusted figures indicate.

Employment in primary metals production fell 1.1 percent compared with February last year, but metal fabrication employment grew by 2.7 percent.

The manufacturing sector as a whole added 12,000 jobs last month after cutting 85,000 people in January. Auto industry employment increased 1,600 jobs in February, but machinery manufacturers shed 2,400 workers.

February’s overall unemployment rate was 7.7 percent, down from 7.9 percent the previous month, the bureau reported.

Economists expect the budget sequestration will prompt employers to step back.

"The sequester will take its toll on job creation in coming months, although within the federal government the hit will be absorbed more in reduced working hours than in (layoffs)," Nigel Gault, chief U.S. economist at Lexington, Mass.-based IHS Global Insight Inc., said. "If the sequester lasts all year, it will take around 400,000 off the job count—a significant impact, but not enough to derail the private-sector recovery."

"Whether the better-than-expected results (in February) signal a faster underlying trend in job growth—and whether it can withstand the fiscal drag from the sequester—has yet to be seen," said Jared Bernstein, senior fellow at the Washington-based Center on Budget and Policy Priorities, Washington. He predicted that the sequester is "likely to reduce growth by about half a percent and kill a bunch of jobs, too."


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