United States: Payrolls growth stronger than expected, unemployment inches up
March 7, 2014
Non-farm payrolls grew by 175,000 in February, which marked an improvement over January's revised increase of 129,000 (previously reported: +113,000). The reading exceeded market expectations of a 149,000 increase in payrolls. Moreover, the result suggests that the impact that harsh winter weather had on the labor market and the overall economy was not as pronounced as expected. The private sector was almost entirely responsible for new hiring, having added 162,000 jobs in February. The largest gains were registered in professional and business services and in the wholesale trade sector. Meanwhile, the public sector added just 13,000 jobs. The U.S. economy has recovered 8.0 million jobs since February 2010, which marked the trough in the labor market crisis. Despite the ongoing improvement over the past three years, the economy still has roughly 666,000 fewer jobs than it had at the January 2008 peak. The unemployment rate-derived from a different survey-ticked up from the five-year-low of 6.6% tallied in January to 6.7% in February. The reading came in above market expectations of no change. While the size of the labor force increased in February, more people were unable to find work, which pushed the unemployment rate up. FocusEconomics Consensus Forecast panelists expect unemployment to average 6.8% this year, which is down 0.1 percentage points from last month's forecast. For 2015, the panel expects the unemployment rate to drop to 6.3%.
Author: Carl Kelly, Economist