The U.S. added 175,000 jobs in February, and the unemployment rate ticked up to 6.7 percent from 6.6 percent. At least that’s the government’s best guess — these initial estimates nearly always get revised, sometimes significantly. Still, the report provides an important window into the economy. Here’s what jumped out at me:
Breathe a sigh of relief: Many economists grew worried that the recovery was losing steam after weak jobs reports for December and January. Friday’s report suggests those fears were overblown. A monthly gain of 175,000 jobs isn’t great, but it’s on track with the pace of recovery over the past couple of years. The Bureau of Labor Statistics also said job growth in December and January was a bit stronger than it initially thought. So, put together, it looks like the slow-and-steady recovery remains slow and steady.
Good news if you have a job: The tepid recovery hasn’t just been hard on the unemployed; weak wage growth has hurt people with jobs. Friday’s report offered fresh evidence that might be changing. Workers’ average hourly earnings rose 9 cents in February, to $24.31. That’s the biggest one-month move since June. Non-managers saw their biggest hourly raise in more than three years.
And perhaps good news even if you don’t have a job: Twenty-one percent of unemployed workers found jobs last month, the best mark of the recovery so far. For the first time in close to four years, more unemployed workers found jobs than dropped out of the labor force. And there are signs that hiring may continue: Employers added 24,000 temporary workers in February, a possible sign of hiring plans. But there’s also mounting evidence the long-term unemployed are being left out of the recovery. About 3.8 million workers have been jobless for more than six months, a figure that doesn’t include the millions more who have given up searching for work.
Let it snow: Many economists warned that Friday’s report could be skewed by the winter storms that swept across much of the country in February. There’s some evidence of that in the data, although the overall effect appears muted. The bad weather forced 626,000 people to stay home from work, far more than in most months, and nearly 7 million more people were able to work only part time. That may be one reason that the average number of hours worked fell slightly. Retailers cut jobs, which might have been the result of customers staying home. But the construction and hospitality sectors, two industries that are often affected by bad weather, added jobs.
Don’t fret about the unemployment rate: The slight increase in the unemployment rate, to 6.7 percent, probably doesn’t mean much. The margin of error is so big that the government doesn’t say the unemployment rate rose or fell when it moves by just a tenth of a percentage point — it says the rate was “little changed.” The slight uptick may not be such a bad thing. Most of the newly unemployed aren’t layoff victims; they’re people who either just entered the job market or who re-entered it after taking some time away. That could be a sign that people are becoming more confident about their job prospects, something that has been hinted at in other data in recent months.