Another Healthy Jobs Report
Total nonfarm payroll employment increased by 235,000 in February, with the unemployment rate holding at 4.7 percent, the Bureau of Labor Statistics reported Friday.
BLS revised total nonfarm payroll employment for December down from +157,000 to +155,000 and revised January up from +227,000 to +238,000. With these revisions, employment gains in December and January combined were 9,000 more than previously reported. Over the past three months, job gains have averaged 209,000 per month.
The report said the number of unemployed persons, at 7.5 million, changed little in February. The unemployment rate, at 4.7 percent, was little changed over the month but was down from 4.9 percent a year earlier. The number of long-term unemployed (those jobless for 27 weeks or more) was essentially unchanged at 1.8 million in February and accounted for 23.8 percent of the unemployed. Over the year, the number of long-term unemployed was down by 358,000. The labor force participation rate, at 63.0 percent, and the employment-population ratio, at 60.0 percent, showed little change.
“Over the past three months, labor market gains in the form of jobs and wages support consumer spending and a continued domestic economic expansion,” said John Silvia, chief economist with Wells Fargo Securities, Charlotte, N.C. “Labor force participation remains a long-term issue.”
Silvia noted to achieve and maintain economic growth of more than 3 percent without accelerating prices, policymakers are challenged to stimulate the supply-side of the economy. “However, labor force participation rates face long-run, secular headwinds that go beyond a short-run cyclical improvement drawing workers back into the labor market,” he said. “There is no quick fix, but focusing on improving both the quality and quantity of the labor force will be key to driving faster, sustainable economic growth.”
Mark Fleming, chief economist with First American Financial Corp., Santa Ana, Calif., said the jobs report should help force the Federal Open Market Committee’s hand at its policy meeting later this month.
“The odds of a Fed rate increase at the meeting next week was already over 90 percent,” Fleming said. “This employment situation report only gives more reason for the Fed to move sooner rather than later.”
BLS reported the average workweek for all employees on private nonfarm payrolls was unchanged at 34.4 hours in February. In manufacturing, the workweek was unchanged at 40.8 hours, and overtime remained at 3.3 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls has been 33.6 hours since August 2016.
Meanwhile, average hourly earnings for all employees on private nonfarm payrolls increased by 6 cents to $26.09, following a 5-cent increase in January. Over the year, average hourly earnings have risen by 71 cents, or 2.8 percent. In February, average hourly earnings of private-sector production and nonsupervisory employees increased by 4 cents to $21.86 in February.
