CIBC Research discusses its reaction to today's US and Canada March jobs reports.
US NFP: "Following an only marginal gain in payrolls in February due to poor weather conditions, March offered some relief. The US labor market created 196K jobs in March, surpassing expectations, while February was revised up by 13K. While the unemployment rate remained at 3.8%, that was partly helped by a fall in the participation rate. The big surprise was the downside miss in wages. The 0.1% monthly advance (vs. 0.3% expected) likely reflected the addition of workers who were excluded from the previous month's measure since they were not a work due to poor weather conditions. As the US economy continues to approach full employment, hiring gains are set to cool over the rest of the year, but like these numbers, the slowing won't be dramatic enough to push the Fed into an outright ease. Overall market reaction is likely to be limited with the beat on the payrolls count offset by the softer wages figure," CIBC notes.
Canada Jobs Report: "The party had to end at some point, since Canadian jobs data had outrun other signposts of economic growth so dramatically, making the small retreat in employment in March not much of a surprise. The 7K drop in employment comes on the heels of huge job gains in January-February, and with the participation rate also coming down a tick from a prior spike, that still left the unemployment rate steady at 5.8%. The wage series in this report, which we see as less accurate than other measures of pay scales, edged up a tick on a 12-month basis to a still moderate 2.3%. Job losses showed up in the private sector, and were scattered across several sectors. Full time jobs fell 6K (after a 67K rise in Feb). There's nothing great about this report, but first quarter hiring still looks very brisk, if anything still too brisk for an economy that's likely chugging along at a 1% to 1.5% growth rate," CIBC adds.