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By Jeremy Glaser and Robert Johnson, CFA | 04-09-2014 01:00 PM

Nothing to Write Home About in This Job Market

Aside from the monthly BLS data, other reports paint a more upbeat picture of the labor market, but we likely won't see near-term changes to current job growth, says Morningstar's Bob Johnson.

Jeremy Glaser: For Morningstar, I'm Jeremy Glaser. There is a lot of tension about last week's payrolls report from the Bureau of Labor Statistics, but it's not the only game in town when it comes to looking at the labor market. I'm here with Bob Johnson, our director of economic analysis, to look at some of these other indicators and what they're telling us.

Bob, thanks for joining me today.

Bob Johnson: Jeremy, it's great to be here today.

Glaser: Let's start with that big payroll report and the unemployment rate that obviously are a big focus for a lot of investors. Is there anything terribly surprising there or anything that concerns you?

Johnson: No, not at all. I think people are quipping, "Oh it was 190,000-something [jobs added in March], instead of 200,000."  And I think the number is not accurate enough, the way they collect the data to really say that it was really that much short or not. I'm really not too concerned about it. As you know, I like to look at that data year over year, and we continue to be, on a private-sector basis, at 2% year-over-year growth. Not accelerating. Not decelerating. Kind of that same, steady pace.

If I had to pick anything in the report that was a negative that I would be concerned about, it is the wage-growth data was very poor in the report. There was actually a small decrement in the wage amount, the average hourly wage. So that's a little disconcerting. Usually when labor markets start to tighten up and things get better, you can expect to see wages go up a little bit. And frankly, it didn't happen this time around. I don't know if it's just a monthly anomaly or what, but it was soft.

Glaser: Some people might be losing some ground there. Job openings, labor turnover, is another report that you look at. What do those numbers tell you?

Johnson: That was fresh out this week. They do come a little bit in arrears, it takes them a while to calculate it. The data we got this week were actually for February, but it's one of the best reports I've seen there for a long time. So many times I read the report and the data are basically unchanged from the previous month. And I think I just read that for the last 18 months, and this time around, it said there were 4.2 million job openings, up from something like 3.9 million the previous month. This is one of the largest increases we've seen in a long time month to month, but better than that, it's the highest number of job openings we've seen in six years. So we've really accelerated in that number.

Then a lot of people like to compare, not just the openings, but how many people are unemployed looking for a job. A year ago that number was as high as three unemployed people for each job opening out there. In January we were at 2.6 [people for job opening] and now this month we're at 2.5. I suppose in a really booming economy, we might be something around 2.2 or so, but we've made some pretty dramatic improvement there over the last year. So, that was another piece of very good news that people haven't talked about a lot.

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