By Vicki Needham and Erik Wasson - 04/03/14 06:53 PM EDT
FRIDAY'S BIG STORY:
Out of hibernation: The March jobs report is due out Friday and it could show that the labor market is finally blossoming — just in time for the warmer weather.
Expectations are that employers added 192,000 jobs last month, up from the 175,000 posted in February, with some estimates as high as 200,000. The jobless rate is forecast to fall slightly to 6.6 percent from 6.7.
Waves of snowstorms and freezing temperatures in December and January put most of the economy into a deep freeze, with employers adding jobs at a much slower pace.
Mark Zandi, chief economist with Moody’s Analytics, predicts that about 185,000 jobs were created last month, including a loss of about 5,000 government jobs.
He also expects the jobless rate to tick down a bit to 6.6 percent.
If job creation and the overall health of the economy improve over the next few months, that could bolster Democrats' chances to hold their Senate seats in the mid-term elections.
Still, there are plenty of challenges in the job market — long-term unemployment remains historically high and the labor force participation rate has hovered around a 35-year low in recent months.
But, finally with the warmer weather, jobs growth should get back to an average of about 200,000 a month, which it had reached at the end of last year.
Zandi expects some payroll bounce back in April, May and June with job creation hitting something north of 200,000, probably between 225,000 to 250,000, giving businesses more confidence and reason to become more engaged and aggressive.
"The job market is coming out from its deep winter slumber," he said.
WHAT ELSE WE’RE WATCHING
Spending strategy: The House House Appropriations Committee continues its efforts on Friday to shake out spending priorities for next year in several more hearings that will include chatting with lawmakers at a Defense subcommittee hearing, talking to the Bureau of Land Management Acting Director Neil Kornze and discussing spending for rural agriculture and ocean energy management programs with government officials.
Poverty program cuts: The new Ryan budget approved by the House Budget Committee on Wednesday evening gets 69 percent of its spending cuts from poverty programs, the Center for Budget and Policy Priorities said in a new analysis out Thursday.
In all, $3.3 trillion in cuts are made over the 10-year budget window to "low-income" programs, while other programs get a $1.5 trillion cut, the CBPP said. The tally includes cuts to ObamaCare, Medicaid, food stamps and Pell Grants in the Ryan plan.
The budget is slated for a vote early next week in the House but its progress will come to a quick halt because the Senate has no plans to consider the GOP blueprint.
Going up: First-time claims for unemployment benefits jumped 16,000 last week to a seasonally adjusted 326,000 but layoffs remain at levels that signal a stable labor market.
The Labor Department said Thursday that the four-week moving average of applications, which better shows where the labor market is headed, was up only 250 to 319,500.
Musical chairs: Sen. Debbie Stabenow (D-Mich.) was named chairwoman of the Senate Finance subcommittee on International Trade, Customs and Global Competitiveness on Thursday.
She previously had served as head of the subcommittee on Energy, Natural Resources and Infrastructure.
"This is a critical time for our economy, and it is critical that we have the right trade policies to open up new markets and help American businesses create jobs in our country,” she said.
Stabenow also has been named to the Joint Committee on Taxation, an independent committee that investigates the federal tax system and prepares revenue estimates of legislation for Congress.
Mind the gap: The nation’s trade deficit expanded by 7.7 percent in February as imports outpaced demand for U.S.-made products.
The gap widened to $42.3 billion from January’s $39.3 billion, the biggest deficit since September, the Commerce Department reported Thursday.
U.S. exports fell to $190.4 billion, a decrease of 1.1 percent, while imports rose to $232.7 billion, an increase 0.4 percent.
"One of the more overlooked factors in sluggish post-recession job growth is the rising trade deficit," said Alliance for American Manufacturing President Scott Paul. "It's not a good sign when the trade deficit goes up, because imbalances don't help create sustainable middle-class jobs."
A higher trade deficit weighs on economic growth, which is expected to come in around 1.5 percent in the first three months of the year, mostly due to an economic slowdown caused by severe winter weather.
Service sector gains: The service sector’s expansion picked up pace last month as hiring jumped, the Institute for Supply Management said Thursday.
The index increased to 53.1 last month from 51.6 in February, which was the lowest reading in four years.
But hiring picked up to 53.6 after taking a dive to 47.5 in February, the largest monthly increase since January 1998, when the survey was first rolled out.
The survey could mean that March's overall hiring number will come in around the 200,000 forecast.
WHAT YOU MIGHT HAVE MISSED
— Lawmakers deserve per diem, says retiring Dem
— Obama signs bill shifting convention funds to pediatric research
— Senate moves on unemployment bill
— Republicans push for one amendment to unemployment bill
— Senate Finance clears tax extenders measure
— Finance adds tax breaks for wind, NASCAR to extenders package
— New Ryan Medicare plan may be easier to defend
— House Oversight to vote on Lerner contempt charges next week
— House appropriators off to fast start
— Transport advocates bash Ryan budget
— Fed's Stein announces quick exit
— Froman: Time for Japan to 'step up to the plate' in trade talks
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