Photo: Tony Crescibene via flickr
But for Deutsche Bank, it’s largely noise.
According to their economics research team, there is a single party leading the weakness:
“Delving deeper into each sub-category, we found that the weakness was primarily concentrated in one specific subsector: general merchandise stores (predominately department stores). Declines (in hiring) in this sector were -51,000 in February and -32,000 in March — the single-largest two-month decline in the history of the series going back to 1989. Indeed, the magnitude of the decline was more than double the next largest two-month layoff spree in 2002 (-41,000).”
Given the recent strength in retail sales, the team concludes there is still nothing to suggest a spring slowdown.
The March employment report and recent backup in jobless claims have fuelled fears that the labour market will slow in the coming months, similar to the experience of the past two years. We do not believe this to be the case for a couple of reasons. First, retail hiring was one of the key sources of weakness in the March survey and this does not jibe with the recent strength in retail sales.