Do You Care if Jobs Data Signal a Recession?

Economists say the loss of 80,000 jobs confirms the economy is in "R" word territory.

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The March job numbers released this morning are certainly not great. The number of jobs on nonfarm payrolls dropped by 80,000 last month. Wall Street had expected a decrease of 50,000 jobs. The percentage of Americans unemployed but looking for work moved upward to 5.1 percent from 4.8 percent last month.

Economists at Goldman Sachs warn: "With payrolls one of the key indicators watched on the call for recession, the likelihood increases that the National Bureau of Economic Research will recognize that the business expansion ended late last year and that the economy has since been in recession."

Other economists are saying similar things. From Forbes:

"It's pretty bad," said David Wyss, chief economist at Standard and Poor's, "and overall more confirmation that we're in a recession." He pointed to the abruptness of the drop in construction, saying that a drop was expected because of weakness not just in residential but in nonresidential activity recently.

"What's especially worrying is March is the first good month you get on construction because seasonal factors aren't as large as they are in January," Wyss said, "so the fact that it came during March makes it doubly troubling."

Stepping away from the data for a moment, yesterday I spoke with Guy Kawasaki, the legendary Apple "evangelist" of the 1980s, about his launch of Alltop.com, a supremely useful news aggregator. Kawasaki's take on recession fears: "If you are an entrepreneur, you can't really let it affect your brain too much that the U.S. government tells you we're in a recession, or not. Because that is a very big macro statistic. All you care about is whether your small business is successful or not. Not the whole economy.... [Americans] go to bed one night and the next morning we read on the front page that according to the Department of Labor we're in a recession. What happened in that eight hours we were asleep? Did the world come to an end?"

I'll have more of my interview with Kawasaki next week on usnews.com.