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What the Media Missed: Inside the (Strong) February Jobs Report - come in hiring




These are just a few of the words the mainstream media used to describe last Friday's jobs report. They're finally right but for all the wrong reasons.

No matter. Ignore this noise and know that jobs growth is accelerating. Understand that yet more positive economic data is supportive for the broader stock market, even if the S&P 500 is within spitting distance of all-time highs and up +5.9% this year.

It can and probably will go higher from here...

Meanwhile, back at the White House...

#JobsReport #Trump #NFP

It didn't take long for sparks to fly. President Trump’s economic team offered their own thoughts on Friday's jobs report. National Economic Council director, Gary Cohn, called nonfarm paroll data “a perfect number." At 235,000 new jobs for the month of February, it's “right exactly where it needed to be,” Cohn said.

Nothing controversial there. But the week seemingly wouldn't be complete without a political monkeywrench from the White House. The Trump administration just couldn't help themselves. On Sunday, the political press had a field day after Trump's budget director claimed, while Friday's jobs data was fine, the Obama administration had "manipulated" labor market data for years.

Setting aside the partisan bickering, here are the facts...

Jobs growth is finally back. Sure, the February jobs report showed 235,000. Yes, that number beat Wall Street's expectations for 200,000 jobs added for the month.

But the media and Wall Street also missed the slowdown in U.S. growth last year – falling five straight quarters from March 2015 (3.3%) to June 2016 (1.3%) – precisely because they didn't dig a tiny bit deeper, thereby missing the bigger picture. 

In January, the labor market snapped a 23-month streak of declining jobs growth (year-over-year), accelerating to 1.6% from 1.5%. That trend held for the month of February, coming in at 1.6% year-over-year jobs growth. As you can see in the Chart of the Day below, wage growth saw modest improvements too.

From here, we're betting jobs growth improves through May 2017 since we'll be lapping last year's truly poor jobs data.

What the Media Missed: Inside the (Strong) February Jobs Report - 03.13.17 EL Chart

What's An Investor to Do?

As we've said many times before, partisan politics has no business dictating your portfolio positioning. Love him or hate him, U.S. economic data has turned positive under the Trump administration. Don't "manipulate" this truth to fit your own political leanings, know that this economic reality will remain positive for the U.S. stock market.