It is clear hiring remains weak for manufacturers as they grapple with global headwinds and lingering anxieties about the overall economic outlook. Employment in our sector declined by 29,000 in March. That said, we have begun to see some signs of stabilization for demand and production in other manufacturing data—but that has not translated into jobs just yet, according to today’s release. Meanwhile, nonfarm payrolls continued to make slow-but-steady gains, with growth near consensus estimates.
For the Federal Reserve, this report does not change much, as short-term rates were not likely to be increased at the upcoming meeting in April anyway. Instead, the Federal Open Market Committee will be looking for broader-based improvements in the U.S. economy as it prepares for its June meeting, and for manufacturers, we would hope that such data would include progress in the industrial sector. Manufacturers have been nervous about the Federal Open Market Committee raising rates too quickly, as they reported in the most recent NAM Manufacturers’ Outlook Survey.
Sluggish hiring for manufacturers should also force our political leaders to consider pro-growth policies to improve overall economic conditions and to allow our businesses to better compete in the global marketplace. The NAM has outlined its pro-manufacturing policy agenda in its “Competing to Win” document, which was released earlier this year.