Jobs Report Reflects Bigger Problems: Opinion

NEW YORK (TheStreet) -- The economy added only 120,000 jobs in March -- not even enough to keep up with normal population growth. The unemployment rate fell to 8.2%, but only because many unemployed adults became discouraged and quit looking for work.

Fourth-quarter economic growth was exceptionally strong as the global economy recovered from first-half disruptions such as the earthquake in Japan, but first quarter growth has been slower. Construction -- both commercial and single-unit residential -- has been hard hit, and now auto sales are slipping.

Manufacturing added 37,000 jobs, but that sector's strong recovery should be generating more gains. Elsewhere, jobs gains were weak and generally down from February.

Construction shed 7,000 jobs, and retailing lost 34,000 employees, as stalwarts like Sears(SHLD) , J.C. Penny(JCP) and Best Buy(BBY) face considerable challenges.

Gains in manufacturing production have not instigated stronger improvements in employment largely because so much of the growth is focused in high-value activity.

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Outside the auto patch, assembly work remains handicapped by the exchange rate of the Chinese yuan. And concerns about the durability of the recovery and health care costs when Obamacare is fully implemented make employers very cautious about adding to payrolls.

Overall, the situation with the yuan is the single largest impediment to more robust growth in manufacturing and its broader multiplier effects for the rest of the economy. The Obama Administration indicated it has no intention of challenging China on this issue, but presumptive GOP standard bearer Mitt Romney promises a harder line.