The U.S. Bureau of Labor Statistics delivered a blockbuster jobs report this Good Friday morning: 180,000 new jobs in March, 32,000 upward job revisions for the prior two months, and a 4.4% unemployment rate.
This stronger than expected report puts the lie to those perma-bear pessimists who keep predicting recession from the sub-prime mortgage problem and the housing slowdown (both a function of tighter Fed money over the past two years).
But the free-market US economy, with its low tax-rates, is more durable and flexible and bigger that just housing and mortgage finance. In the March job report, big job gains came from business construction, retail trade and a variety of services.
Unemployment for those with a bachelors degree or higher was only 2.2%. For traditional families with both spouses present, joblessness was 2.5%.
The rate of economic growth ebbs and flows over long expansion periods such as this one (which is now in its sixth year). Sometimes faster, sometimes slower, but in the absence of major policy blunders (big tax hikes, bad inflation, major trade barriers, nasty regulations) the economic pie keeps expanding.
Stocks have been predicting continued growth for quite some time. Since last summer, the major indexes are up about 20%. Year-to-date they are up roughly 3% so far. Since the Bush tax cuts they’re up roughly 100%.
Isn’t it interesting that markets are better economic predictors than perma-bears?