The U.S. economy created 242,000 new jobs in February, exceeding economists’ expectations, but the average hourly wage and the number of hours that people worked declined.
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The health and social assistance sector created 57,000 net jobs, followed by retail trade (55 000) and restaurants (40 000) showing that consumers still driving growth.
“The number of unemployed persons, at 7.8 million, was unchanged”.
“The only disappointing numbers are on average weekly hours, which dropped by.2, and average hourly earnings, which dropped by 3 cents”, said Harry Holzer, former Chief Economist of the U.S. Department of Labor and author of Where Are All The Good Jobs Going?
The Labor Department also revised up its estimates of job growth in December and January by a combined 30,000 on Friday. The manufacturing sector also shed jobs in February, as employment in both durable and nondurable goods manufacturing fell by 12,000 and 4,000 jobs respectively.
Although the average pay of workers in US did slide last month after having increased in January, more Americans who had prior been sitting on the sidelines began their search for jobs last month and were also successful in finding them. The so-called U6 rate dipped to 9.7% from 9.9% and reached the lowest level since May 2008. The Fed had raised its key overnight interest rate in December for the first time in a decade. These have been some of the strongest growth industries over the last few years, which means the economy is adding a lot of low wage, service sector jobs. “Today’s jobs report is consistent with our view of an affordability-constrained housing expansion”. When the economy is strong, companies often ask employees to work more hours as a precursor to hiring. If most analysts doubt an increase in interest rates from the meeting due to the global slowdown and volatility in financial conditions in a context of inflation still silent, the employment figures for February certainly rely on future increases in the rate table later in the year.
In 2016, economists are looking for wages and labor-force participation to improve. But the decline since 2007 has been faster and deeper than economists anticipated, and than can be accounted for by the aging US workforce.
Construction employment-a metric of real estate industry health-continued to trend upward in February, adding 19,000 positions for the month, with a gain of 14,000 in residential specialty trade contractors. It says DE gained 11,000 jobs in 2015 – up 2.4 percent for the year.
Four years ago, when President Barack Obama was fighting to stay in the Oval Office, the jobless rate sat at 8.3 percent, with the economy still in the early stages of recovery from the Great Recession.
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But it must be noted the weaker February wage growth was largely payback for January’s jump, which was driven by a calendar quirk.
