The Institute for Supply Management surveys released on Monday and Wednesday for the manufacturing and the non-manufacturing (service) industries, respectively, may shed some light on Friday’s employment report for February.
According to Bloomberg, economists anticipate a 50,000 decline in nonfarm payrolls for February, compared with a 20,000 dip in January, while the unemployment rate is expected to increase from 9.7% to 9.8%.
And recent data have shown an uptick in weekly jobless claims, suggesting that we may see additional job losses. Harsh winter weather is the primary reason for the expected weak payroll numbers.
However, the respective employment indexes from the ISM surveys suggest that many analysts may have been a bit too pessimistic when it comes to February’s numbers.
A reading of 50 marks the line between job destruction and creation.
Trends have definitely improved over the past year, especially in manufacturing, and the extreme layoffs experience in much of 2009 have abated. Note the rebound reflected in the above chart.
Though the economy is still months away from creating the number of jobs needed to boost confidence in the recovery, the closely-followed surveys are starting to flash positive signals, especially in manufacturing.
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