WASHINGTON (MarketWatch) — The U.S. generated 175,000 jobs
in February despite harsh winter weather, suggesting the economy has not slowed
as much as a recent spate of indicators appear to show.
The unemployment rate, meanwhile, edged up to 6.7% from 6.6%
to mark the first increase in 14 months. Yet the rate rose because more people
entered the labor force in search of jobs, which is usually a sign that they
think more work is available.
What’s more, employment likely would have been stronger if
not for the weather. The number of people who said they could not make it to
work surged above 600,000 last month, twice as many as is normally the case in
February.
The better-than-expected headline number on jobs lifted U.S.
stocks in early action and paves the way for the Federal Reserve to continue to
withdraw stimulus from the economy. Economists surveyed by MarketWatch expected
an increase of 140,000 nonfarms.
“Today’s report should provide some relief for those
concerned that a more sustained slowdown might be underway,” said Jim Baird,
chief investment officer at Plante Moran Financial Advisors.
Yet the latest jobs report also contained some worrisome
signs. Hiring in the health-care industry has sharply tapered off and the
number of hours that people work each week fell again and touched the lowest
level in three years. The decline in hours worked in February was largely
because of poor weather, but the workweek is still several ticks below the
post-recession peak last achieved in November.
Both of these trends raise questions as to whether the
advent of the law commonly known as Obamacare has spurred companies to cut
hours or hire more part-time workers.
The pace of hiring is also a lot softer compared to last
fall. The economy has added an average of 131,000 jobs in the past three
months, compared to an average of 225,000 from September through November. And
the number of people who have been out of work at least six months rose by the
largest amount in almost two years.
Northern California College of Construction are displayed at
the Recruit Military veteran job fair in San Diego, California, U.S., on
Thursday, Feb. 27, 2014.
Economists say it may take another month or two to get a
better read on the economy’s health because of unusually cold and snowy weather
in the early part of 2014.
Inside the report
In February, hiring was strongest in professional services,
education and bars and restaurants, the Labor Department said .
The professional ranks — engineers, executives, lawyers and
the like — swelled by 79,000 in February after two straight months of soft
hiring. That category of workers has grown the fastest since the Great
Recession ended in mid-2009.
About one-third of the professional jobs were temporary,
however.
Bars and restaurants added 21,000 jobs in February and that
was something of a surprise because of the poor weather. Governments at all
levels also increased employment by 13,000 after a 16,000 drop in January.
The construction industry boosted hiring by 15,000, but that
was down sharply from 50,000 in January. Builders have indicated they expect to
hire more people in the spring once they get back to work unimpeded by the
weather.
Manufacturing gained a modest 6,000 jobs for the
second-straight month.
Several sectors reduced employment, including retail,
information services, and transportation-related industries.
Retailers cut 4,000 jobs after shedding nearly 23,000 in
January. The number of workers in information services sank by 16,000 and has
fallen three-straight months. And transportation jobs edged down by 3,600.
Average hourly wages, meanwhile, increased a healthy 9 cents
to $24.31, and they have risen 2.2% over the past 12 months. Some economists
point to an uptick in wages recently as evidence that companies have to pay
more to attract good workers, typically an early sign that the labor market is
getting stronger.
“Conditions aren’t great, but they’re continuing to
improve,” said Neil Dutta, head of economics at Renaissance Macro Research.
Yet the average workweek fell by 0.1 hour to 34.2 hours in a
negative sign. While bad weather clearly kept people from their job, the
numbers of hours worked has been on the decline since late last year.
The civilian participation rate held steady at 63%. The size
of the labor force — people who have jobs or are looking for work — rose by
264,000 last month.
Employment gains for January and December were revised up by
a combined 25,000. The number of new jobs created in January was raised to
129,000 from 113,000, while December’s figure was upped to 84,000 from 75,000.
Source: MarketWatch
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