The jobs report for February is pretty, well, decent. Headline numbers include:
Jobs Added: 227,000
Revised Jobs Added for January: 284,000
Unemployment Percentage: 8.3%
Hourly Earnings: +1.9%
One thing I’m really glad to see is a drop in the length of average unemployment to 40 weeks:
That’s still a really, really high number of course.
Some selected analysis of today’s report –
Some of the broader indicators are encouraging, too. The employment-to-population ratio is up one-tenth of a percentage point to 58.6 percent. The number of people who are “long-term unemployed” — that is, who have been out of work for more than 27 weeks — fell from 5.5 million to 5.4 million. (Although that’s still an enormous number by any metric.) Over the past year, average hourly earnings are up 1.9 percent. And temporary hiring has surged to 45,000, which often presages an increase in permanent hiring.
One of the things I’m paying attention to is the dispersion of job growth across industries, an indicator of how widespread and thus how sustainable is the jobs market recovery. Most industries added jobs last month–manufacturing was up 31,000–and while state and local job losses remain a problem, governments have been losing fewer jobs over the past few months (down 6,000 last month and only 1,000 in January). Construction, however, remains a weak spot, shedding 13,000 jobs in February.
We had a nice gain of 223K but the big news is in the revisions especially January which was taken up to 284K.
That’s a big deal because it breaks – what feels like to many economists – an intuitive barrier on job creation. Practically speaking the economy behaves as if it has a lot of inertia, particular in job creation. Its hard to see numbers like that and not think the underlying momentum is moving forward.
How can an unchanged unemployment rate be good news? The unemployment rate falls when more people get jobs, and it increases when more people enter the labor force and begin looking for jobs. In the current report these two factors offset each other leaving the unemployment rate unchanged. There were more jobs, but also more people looking. As the BLS reports, “The civilian labor force participation rate, at 63.9 percent, and the employment-population ratio, at 58.6 percent, edged up over the month.” The fact that more people are looking for jobs can be viewed in a positive light since it reflects increased optimism about their chances of finding employment.
One way to drill down into this question is to reflect on the really big picture: Where the jobs are going and where aren’t they going. Since Obama’s first month on the job, total government has lost 600,000 jobs. (He’s a pretty bad socialist, apparently.) The goods-producing sector, which includes manufacturing and construction, is still down 1.6 million jobs — as many jobs as we added all of last year! All the growth has been in services, where we’ve added 1.3 million new positions.