The U.S. unemployment rate stood steady at 4.9 percent in February as the economy added 242,000 new jobs, the Bureau of Labor Statistics announced Friday. The improvement will help ease fears that arose in recent weeks that a new USA recession might be looming. But the wage figure was disappointing, particularly coming after a strong month in January.
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Here are five key takeaways. All told, employers have now generated more than 13 million jobs over the course of 65 consecutive months of growth. The actual job growth far exceeded that.
The change in total nonfarm payroll employment for December was revised from +262,000 to +271,000, and the change for January was revised from +151,000 to +172,000. They meet later this month.
Employment gains were driven by jobs in health care, social assistance, retail trade, food and drinking services, and private educational services.
But the slowing world economy took its toll in other areas of the US economy. The measure bottomed out at 62.4 per cent in September-the lowest level since 1977-but has crept up steadily as more people joined the workforce.
The labor force jumped by 555,000 people in February, the largest in more than a year and the fourth-straight monthly increase. That improvement followed a solid 2015, when sales achieved their highest level in nine years.
“The labor force picture is encouraging”, O’Keefe said. “There weren’t actually mass firings of college professors that we’re aware of”, said Ted Wieseman, an economist at Morgan Stanley in NY.
Average hourly earnings dropped by 0.1 per cent from the prior month, the first decline since December 2014, the Labor Department’s figures showed.
Paul Ashworth, chief US economist for Capital Economics, said, “Overall, it’s clear that labor market conditions are still strong”.
For the 12 months ended February 29, wages have increased 2.2%, which is well above the low inflation rate but slower than the annual pace recorded in the previous six months.
The pickup in job gains shows that the USA economy has largely weathered a broader global slowdown without suffering much blowback.
Stock investors appeared to cheer last month’s job growth.
“I think this [report] does offer further strength in the confidence that the recovery still has a solid forward momentum”, O’Keefe said. “Given this, job creation and economic expansion should continue to be encouraged, not tamped down with another interest rate hike from the Federal Reserve at their next meeting”. “The labour market doesn’t appear to be hurt by financial market volatility”. So, of the 242,000 jobs created, 189,000 of them were in the minimum wage ballpark. As for the Fed, this was a decent report but not one that would hold anybody’s feet to the fire to raise rates later this month.
Fed policymakers have been concerned that inflation remains low.
Still, troubles overseas have tempered USA economic growth.
U.S. employers added more jobs than expected in February but wages declined compared to a month earlier, the Labor Department revealed on Friday.
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“The employment data should reinforce that the recession debate is premature and overdone, and could strengthen the case for the Fed not waiting too long”, said Ryan Sweet, senior economist at Moody’s Analytics in Westchester, Pennsylvania.
