U.S. Outlook: U.S. job gains fall far short joining global slowdown
We can now add the U.S. labor market to the chorus of global economic indicators pointing to a sharp slowdown in economic activity in the first quarter. Nonfarm payrolls increased only by 20K jobs in February, down from 311K in January.
However, snowy weather during the survey week may be exaggerating the extent of the deterioration in labor market conditions as construction payrolls fell by 31K in February after gaining 53K in January. But weather doesn’t explain all of the weakness. U.S. manufacturing payrolls only managed a 4K net job gain, down from a 21K gain in January.
For more on this, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on March 8.Key observations:
- Average hourly earnings rebounded a robust 0.4% in February, lifting the year-on-year gains to a new expansion record of 3.4%.
- Hours worked slipped to 34.4 hours from 34.5 hours, another sign that weather may have negatively impacted the job numbers last month.
- The number of people classified as unemployed fell by a large 300K last month, down to 6.235 million, helping to push the U.S. unemployment rate back down to 3.8% from 4.0% in January.
- The labor force participation rate held at recent highs of 63.2%, suggesting that the underlying labor market still remains tight despite the lack of net new jobs last month.