The reaction to last week's employment report, both in the stock and bond markets and the ex-post analysis, was so extreme that I decided to do a little digging. Was one sub-par jobs report, with its payroll gain of 120,000, the game changer it was made out to be? Or was it just another piece of data, subject to revision?

Joe Carson, head of global economic research at AllianceBernstein, called my attention to the two-month decline of 83,000 jobs at general merchandise stores. It is "the largest in the last two decades," he said. (I'm tempted to call it "unprecedented.")

What's more, the bad labor-market news coincided with upbeat reports from retailers. Chain store sales, excluding drug stores, rose 6.8 percent in March from a year earlier, according to the International Council of Shopping Centers. That came on the heels of February's 6.7 percent jump, an improvement over last year's average increase of 5.3 percent, according to Mike Niemira, chief economist at the ICSC.

The BLS told me that the sample survey response from retailers in March was weaker than normal. (The BLS surveys 486,000 worksites each month to compile its establishment survey.) That doesn't explain the huge 51,000 job loss in February, which BLS says captured the seasonal, post-Christmas layoffs.

Even the Federal Reserve's Beige Book, which compiles anecdotal information on business conditions in all 12 districts, said reports on retail spending were positive. If the decline in retailing jobs were indicative of the state of the industry, it would have been picked up in the regional surveys and by the ICSC with its members.

The job loss "is not consistent with the sales pace," Niemira says. "It's hard to say it's a fundamental change."

It may not be a fundamental change. But for now, it has fundamentally changed the way the market is viewing the U.S. economy.

(Caroline Baum is a Bloomberg View columnist. Follow her on Twitter.)

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