In labor force data published by the US Labor Department last month for March, non farm payrolls were 916 thousand, exceeding market expectations of 647 thousand, while the unemployment rate was recorded at 6.0 percent in line with expectations.




*In the United States, nonfarm payrolls, ADP  private sector employment change and jobless claims are divided into 10 thousand in the composite chart above. The left axis of the chart shows nonfarm payrolls and ADP data, and the right axis shows the number of people applied for jobless benefits.

Aiming to minimize the impact of coronavirus (Covid-19) outbreak on the economy, the US administration has provided close to $ 5 trillion financial support, while the Federal Reserve maintained ultra-loose monetary policy by adhering to its target of maximum employment and average inflation of 2 percent. Nonfarm payrolls rates, which signal recovery along with fiscal and monetary policies, surprised the markets last month by rising by 916 thousand.

President Joe Biden included a $ 1.9 trillion financial aid package on the agenda since he took office. $ 1.9 trillion support approved in nearly 2 months was a package covering small, medium and large businesses. ISM Manufacturing Purchasing Managers' Index (PMI) rose to a 33-year peak last month, along with optimism brought by this package, while in April this level fell slightly to 60.7. However, the data pointed out that the economy was continuing to recover, while also supporting employment rates.

On the other side, the United States stepped up its vaccination campaign and reached up to 253 million doses by now. The acceleration of the vaccination process was another factor that contributed to employment rates, reflecting positively on the manufacturing and non-manufacturing (service, construction) sectors.

At the FOMC meeting, the Fed stated that they will not give up the current monetary policy step until the economy fully recovered, and the optimism of the vaccination campaign affected the data of the New York research organization The Conference Board, and Consumer Confidence reached 121.7, the peak of the 14-month period. In addition, according to ADP Research Institute, private sector employment increased by 742 thousand people.

After the Biden administration approved the $ 1.9 trillion financial aid package, expectations for a 2.25 trillion dollar package, which includes infrastructure and employment support, increased, and also an incentive package worth 4 trillion USD has recently come to the agenda. Some sources said this package is discussed in the US Congress.

These stimulus packages can contribute to the recovery of the US economy and they will possibly support the employment rates.
Today, U.S. Bureau of Labor Statistics will release labor force stats of April at 14:30 (GMT+2). Depending on the strong support of the Federal Reserve and the Congress and the momentum in the vaccination campaign, we believe that in line with the increasing labor demand of the producers in the leading sectors of the economy, nonfarm payrolls will increase by around 900 thousand and the unemployment rate will decline below 6.0 percent threshold.