Episode summary
Instant Reaction: US Unexpectedly Sheds 92,000 Jobs in Latest Report | Bloomberg Businessweek
Bloomberg Businessweek Daily
· · Hosts: Carol Massar, Tim Stenovec · Guests: Claudia Sahm, Nadia Lovell, Jennifer Lee
Summary
The labor market report was sharply weaker than expected: nonfarm payrolls fell by 92,000 in February versus expectations for a gain of 55,000, and the unemployment rate rose to 4.4% from 4.3%. The host said the market reaction was immediate, with futures selling off and the VIX jumping, as investors reassessed whether the economy is still in a “jobless expansion” or moving toward something worse.
Claudia Sahm argued that the data do not yet show a recessionary dynamic, but they do reinforce a troubling pattern of very weak job creation alongside gradual unemployment drift higher. She said labor supply has likely been reduced by lower immigration, but also stressed that the problem is not only supply: there is still not enough demand for workers. She said the Fed will watch the employment risks closely and still has rate cuts as a blunt tool to support demand if needed.
Nadia Lovell said the report was surprising because it clashes with recent signs of labor-market stabilization, but she did not think one month was enough to change the broader market view. She said UBS is still staying invested, though with more attention to risk, and remains constructive on equities over the year. Jennifer Lee called the jobs print an “eye opener,” said it strengthens the case for the dovish camp at the Fed, and argued that wage growth is still helping keep the consumer afloat even as retail sales and sentiment soften.
Key takeaways
- The February jobs report showed a 92,000 decline in payrolls, which the host and analysts treated as a meaningful downside surprise.
- Claudia Sahm said the U.S. has been in a jobless expansion for over a year, and this report suggests that pattern is still intact.
- Sahm said reduced immigration has lowered labor supply, but weak demand for workers is still a separate problem.
- Nadia Lovell said UBS is not yet making a major defensive shift, but the report raises near-term market risk.
- Jennifer Lee said the data keep June rate cuts in play and strengthen the Fed’s dovish side.
- Lee said wage growth remains a key cushion for consumers even as retail sales and discretionary spending soften.
Notable quotes
“the Labor Department says the US economy lost 92,000 jobs in February. That is worse than expected”
“we have already been for a year in a jobless expansion so unfortunately what the February data what this latest labor market data suggests is that's still where we're at”
“this puts uh you know, the doves on the uh the minority of the do of the doves on the Federal Reserve right back into play”
“So, there's a lot of noise about AI, but time's too tight for more promises. So, let's talk about results”
How the episode opens
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Bloomberg Audio Studios, podcasts, radio, news. This is a breaking news update from Bloomberg. Instant reaction and analysis from our 3,000 journalists and analysts around the world. I'm Alexis Christopherus and these numbers just crossing the Bloomberg. Now, the Labor Department says the US economy lost 92,000 jobs in February. That is worse than expected. We were looking at an additional 55,000 jobs. And of course, this is compared to January when we added 130,000 jobs.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- jobs report
- unemployment rate
- labor market health
- health care employment
- strike activity
Companies and tickers mentioned
- UBS
- BMO
- New Century Advisors
- UBS Global Wealth Management
- BMO Capital Markets
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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