Interest Rate Roundup

Friday, November 03, 2006

Dissecting the Oct. jobs report ...

So overall nonfarm payrolls rose in October (92,000), but less than expected. Where was the weakness? Where was the strength?

Sectors with notable gains:
mining (+4,600)
clothing/accessories stores (+6,000)
transportation/warehousing (+6,800)
Publishing (+3,700)
Finance and insurance (+6,400)
Management and technical consulting (+11,700)
Administrative and waste services (+24,000)
Health care and social assistance (+27,600)
Food service and drinking places (26,700)
Local government (+39,000) -- big teacher hiring

Sectors with notable losses:
Construction of buildings (-6,100)
Specialty trade contractors (-22,000) -- residential contractors took a huge hit, while nonresidential was up several thousand
Durable goods manufacturing (-19,000) -- autos, furniture, fabricated metal, and wood products particularly bad
Nondurable goods manufacturing (-20,000) -- plastics and rubber worst off, but lots of categories saw little hits
Real estate/rental/leasing (-4,800)

This isn't a complete list of all categories, but some trends are clear: Residential real estate and sectors related to it are in big trouble ... commercial real estate is still okay ... and food service/health care/entertainment/local government sectors are where the biggest job growth can be found right now.

Whether that holds up, though, depends on the broader economy. I have my suspicions about retail and commercial real estate -- both could get whacked if consumer spending continues to show signs of slowing and/or if hiring doesn't pick up. Those factors would hurt retail hiring, demand for mall and office space, etc.


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