Sourtesy of Southbay Research
December Nonfarm Payrolls - Key Trends
- Transportation revised up thanks to UPS/Fedex revisions
- December boosted by warm weather, January to reverse
- Low oil prices benefiting the petrochemical sector
- Consumer Spending remains strong
Courier payrolls revised up as expected
Last month courier payrolls were reported at -3K This reflected an unbelievably low not seasonally adjusted figure of +25K. I predicted a big revision here and I was correct: Courier NSA payrolls were revised up to 65K, boosting the seasonally adjusted figures to +11K
Thank the Warm Weather
Mild weather boosted December payrolls ~40K: Construction payrolls (+45K), Building Material payrolls (+9K), Retail Clothing Store payrolls (-17K), and building services (+3K). I would even include the 15K surge in motion picture hiring as well as some of the restaurant payroll jump. And that's on top of November which had a similar experience.
It means a big payback in January when these trends reverse. Expect a 70K headwind next monthIn essence the warm weather delayed seasonal layoffs. They are still going to (largely) happen
The Upside to low oil prices
The oil sector has been decimated but the downstream chemical and rubber producers have benefited from the low prices. They represent a larger employer base and their payrolls continue to move up
Consumer Spending remains Solid
Restaurant and Bar payrolls rose an impressive 37K. That's the most important consumer sentiment related sector and it came in strong.
Key Trends:
- Construction: +45K
- Manufacturing: +8K
- Retail: +4K
- Temp workers: +34K
- Healthcare: +53K
- Food Services: +37K