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May 7, 2016 | 160,000 US jobs: Look beyond headline number

Adrian Mastracci

Adrian Mastracci, Discretionary Portfolio Manager, B.E.E., MBA. My expertise in the investment and financial advisory profession began in 1972. I graduated with the Bachelor of Electrical Engineering from General Motors Institute in 1971. I then attended the University of British Columbia, graduating with the MBA in 1972. I have attained the “Discretionary Portfolio Manager” professional designation. I am committed to offering clients the highest standard of personal service by providing prompt, courteous and professional attention. My advice is objective, unbiased and without conflicts of interest. I’m part of a team that delivers comprehensive services and best value in managing client wealth.

US data headlines for April 2016 are flashing a disappointing 160,000 jobs.
A moving picture of weaker growth, short of expectations.

Especially as job predictions were in the 202,000 ballpark.
Not to mention downward revisions to recent figures.

One month of data does not make a long term trend.
Averaging the results is a better gauge of economic activity:

Period

US Job Averages

Last 3 Months

200,000

Last 6 Months

220,000

Last 9 Months

213,000

Last 12 Months

212,000

The takeaway is that the recent data is heading the wrong way.
The 3 month jobs average barely takes care of population growth needs.

Tepid jobs together with slower GDP are a less than desirable combination.
This scenario could accelerate the economy stalling.

A resumption towards the 250,000 plus level would be a welcome change in outlook.
Job averages need to remain strong for interest rates to rise from today’s levels.

I suggest adopting this approach:

Revisit your portfolio composition.
Make only logical, well thought out decisions.

Use market rally opportunities to prune portfolio selections that don’t belong.
Purchase some investments that better fit your asset mix.

It’s best to always look at the big picture.
Don’t get stuck pondering the headline numbers.

Talk soon,

Adrian

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May 7th, 2016

Posted In: Adrian Mastracci Blog

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