JOBS REPORT WIL BE STRONG?

Strong U.S. jobs gains seen in February -- really ***(Report due out at 8:30 AM FRIDAY, I will be back with comment) Duratek (because if so, remember birth death post, rates could push above 4.40% and GOOD news might become BAD IMHO)

Wed Mar 2, 2005 12:28 PM ET By Andrea Hopkins

WASHINGTON, March 2 (Reuters) - The U.S. economy likely added 220,000 jobs in February and some analysts believe hiring was even stronger than that -- and not just because employment gains have to improve eventually.
While forecasters have been disappointed by only modest hiring in the last three months, a never-say-die approach has taken hold among those who believe the economy is ticking along far more nicely than recent employment data would suggest.
"We've had some lackluster job growth over the past several months and economic activity has continued pretty strong. At some point businesses have to start hiring again and we think this will be one of those months," said BMO Nesbitt Burns senior economist Michael Gregory.
"It's almost the elastic band theory. Everyone knows underlying payroll growth was better than what was suggested by 130,000 or 140,000. So you're pulling the elastic band and it is going to snap back -- you're going to get that surprise 200,000 or even maybe a 300,000," he said.
The median estimate from a Reuters survey of 29 analysts is for 220,000 new jobs in February. Even the lowest estimate of 145,000 would match January's growth in payrolls, while the highest foresees a 300,000 gain.
The Labor Department's closely watched payrolls report, due at 8:30 a.m. EST (1330 GMT) on Friday, is expected to show no movement in the nation's 5.2 percent unemployment rate after an unexpected dip in January, since many Americans are rejoining the job hunt as the economy gains strength.
Analysts forecast a 0.2 percent rise in average hourly earnings and a slight lengthening of the workweek to 33.8 hours. Longer hours are considered an early sign of future hiring, since employers tend to make existing workers put in more time before taking on new hires.
WE MEAN IT THIS TIME
While economists forecast gains of 180,000, 175,000 and 190,000 jobs in November, December and January -- and got just 132,000, 133,000 and 146,000 -- they point to a raft of data that suggests February was a better month for job-seekers.
"Much of (Wall Street's) estimate is based on the recent improvement in unemployment claims, which have fallen to their lowest level since October 1999. The drop in jobless claims is consistent with a strong gain in nonfarm payrolls," Wachovia economists Mark Vitner and John Silvia said.
First-time claims for state unemployment benefits averaged just 312,000 for the four weeks leading up to Feb. 12, compared with 341,000 one month earlier -- suggesting a significant drop in layoffs. The monthly payrolls report covers the pay period that includes the 12th of the month.
On the hiring side, analysts were buoyed by a sharp pickup in help-wanted ads in January and a decline in the number of consumers who said jobs were hard to get in February, measures put out by the Conference Board, a private research group.
Still, the string of disappointing job gains since October -- the last time the report pleased observers -- has created some skeptics.
"For every person who thinks there could be an upward surprise, there's probably someone else who is still pessimistic and is looking for something weaker," said Patrick Fearon, economist at A.G. Edwards & Sons in St. Louis.
Ironically, the strengthening economy may also be contributing to job cuts, as mergers and acquisitions pick up -- prompting companies to eliminate duplicate work.
Employers announced a 17 percent surge in layoffs in February, according to a report on Wednesday by employment consulting firm Challenger, Gray & Christmas. That took job cuts in the first two months of 2005 to 200,738.