 | Nonfarm payrolls rise 192K in February |
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Implications: Very good report on the labor market this morning. Including upward revisions to prior months, non-farm payrolls increased 250,000. But this includes a decline in government; private sector payrolls were up 268,000 (again, including upward revisions to prior months). The strength was confirmed by figures on civilian employment – an alternative measure of jobs that is better at picking up the self-employed and small start-up businesses – which increased 250,000 in February. Meanwhile, the increase in jobs pushed down the unemployment rate to 8.9%, the lowest in almost two years. Once again, what was particularly good about the drop in the jobless rate was that it was all due to full-time workers, showing that employers are getting more confident. In fact, the net share of private industries adding jobs was at the highest level since 1998. Getting into the details of the report, we see signs of a recovery in home building: in the past two months, residential construction payrolls have increased 19,000, the most since early 2006. Although average hourly earnings were unchanged in February, the number of hours worked increased 0.2%. As a result, total cash earnings for workers increased at a healthy 3.2% annual rate in February and are up 3.7% in the past year. So far, this is more than enough for workers, as a whole, to keep up with inflation. Given better economic news on both manufacturing and service output, as well as auto sales and chain store sales, the underlying trend in job growth will continue to accelerate in the months ahead.
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