WASHINGTON (AFX) - U.S. economic indicators to be released this week are expected to show a further weakening of the U.S. labor market although the number of new jobs will still be positive, according to economists polled by AFX News.
"We believe the labor market performance is going to be relatively weak," said Nick Bennenbroek, an economist at Deutsche Banc/Alex Brown who predicted that non-farm payroll growth will post a decrease of 25,000 jobs.
March's decline of 86,000 was the largest fall in non-farm payrolls since Nov 1991. An AFX consensus survey found that economists expect 21,000 new jobs to have been created in April.
The weakening labor market is a result of the need for firms to scale back their expenditures as profit margins declined in the first quarter of 2001.
As Robert McGee of Tokai Bank in New York explains: "Companies are having to cut costs to deal with the slow economic growth so they are having to trim investment spending and employment."
The National Association of Purchasing Management's index of business activity should get a slight boost from an increase in automobile production.
"That should show an increase to about 45 based on the turnaround in the automobile production," McGee said. The NAPM index stood at 43.1 in March.
Following are consensus forecasts of Wall Street economists for data to be released this week.
MARCH CONSUMER SPENDING, Monday (8.30 am): Economists predict consumer spending will rise 0.2 pct in March, after rising 0.3 pct in February.
MARCH PERSONAL INCOME, Monday (8.30 am): Economists expect personal income to rise 0.4 pct in March, after rising 0.4 pct in February.
MARCH CONSTRUCTION SPENDING, Tuesday (10.00 am): Economists forecast construction spending will rise 0.3 pct in March, after rising 0.6 pct in February.
APRIL NAPM PMI, Tuesday (10.00 am): Economists predict the NAPM manufacturing purchasing manager's index will rise 3 pct to 44.5 in April from 43.1 in March.
MARCH FACTORY ORDERS, Wednesday (10.00 am): Economists expect manufacturing orders to rise 1.4 pct in March after falling 0.4 pct in February.
WEEK TO APRIL 28 INITIAL CLAIMS, Thursday (8.30 am): Economists forecast initial claims for regular state unemployment benefits will fall 8,000 to a seasonally-adjusted 400,000 for the week ended April 28 from the previous week, when they rose 8,000 to 408,000.
APRIL EMPLOYMENT GROWTH, Friday (8.30 am): Economists predict 21,000 new jobs were created in April. 86,000 jobs were lost in March. APRIL UNEMPLOYMENT, Friday (8.30 am): Economists expect the unemployment rate to reach 4.4 pct in April, after hitting 4.3 pct in March.
APRIL HOURLY EARNINGS, Friday (8.30 am): Economists expect hourly wages to rise 0.3 pct in April, after a 0.4 pct increase in March.