Confidence that a strong economic recovery might finally be taking hold was shaken last week with the labor report that 120,000 jobs were created in March, a drop from three straight months of 200,000-plus job growth.
Data in future months will separate blip from trend. Was the decent job growth seen December through February a trend that will resume, with March an anomalous deviation, or was it the earlier job growth that was illusory?
The answers will have huge political implications for the presidential and, to a lesser extent, congressional races. What is clear is that the recovery still faces strong head winds. High gas prices are sapping consumer confidence, eroding disposable income, making it difficult for many small businesses to hire and pushing up prices on groceries and other necessities.
Increased global demand, lack of refinery capacity and fear of shortages in the event of a confrontation with Iran continue to put upward pressure on oil prices and the Obama administration lacks the tools to significantly influence those factors.
Lack of salary growth, a still weak housing market and high personal debt will make it difficult for consumers to drive an upturn, while many corporations remain reluctant to invest available cash in new jobs until confident of a recovery, a classic Catch 22.
This is more evidence that the last recession was not part of a typical cycle, but an event that fundamentally damaged the economy.