Payrolls Up 227,000 in February; Unemployment Rate Steady
By: Mark Lieberman, Five Star Institute Economist
The nation added 227,000 jobs in February – the seventh straight month of 100,000-plus payroll gains, the longest such string since 2005 – as the unemployment rate held steady at 8.3 percent, the Bureau of Labor Statistics reported Friday morning.
Economists had anticipated about 210,000 new jobs in February and a slight uptick in the unemployment rate.
Indeed, the unemployment rate – if calculated to additional decimal places – did increase slightly but still rounded to 8.3 percent. The increase would reflect workers returning to the labor force.
The strong report continued a positive trend with just a smattering of weak spots: retail employment dropped slightly and construction jobs declined, hinting that gains in construction in recent months were related to mild weather.
Payroll gains for December and January were revised upward. January’s payroll growth was changed to 284,000 from 243,000 and December’s was revised to 223,000 from 203,000.
In other key statistics in the report, average weekly hours increased along with average hourly earnings which should help personal consumption spending, about 70 percent of the nation’s Gross Domestic Product (GDP).
Government was less of a drag on the payroll report in February than it has been in recent months, subtracting about 6,000 jobs. Federal payrolls shrank by 7,000 while state and local payrolls improved by a net, 1,000. State and local governments appear – for the moment – to have weathered the evaporation of federal stimulus funds.
Even with the improved labor picture, 42.6 percent of those officially counted as unemployed have been out of work for more than 27 weeks and the average duration of unemployment, though improved from February, was 40.0 weeks.
There were both bright spots and yellow flags for the housing sector: credit intermediation jobs – essentially underwriting positions – increased, but construction payrolls slipped, dropping 13,000 jobs, primarily in non-residential activity.
For the overall economy, retail employment slipped slightly reflecting the wind-down of holiday shopping and its aftermath. Temporary jobs rose a strong 45,200 in February, a statistic which could be interpreted as good or bad. On the one hand, temporary employment is considered a precursor to permanent positions but on the other hand temporary workers represent less of a commitment than permanent hiring, a reluctance by employers to increase staff – and benefit costs.
Professional and business services payrolls – which include those temporary jobs – expanded by 82,000, the strongest sector, followed by education and health care (up 71,000) and leisure and hospitality (up 44,000). The leisure and hospitality sector is the lowest paying of the major industry sectors.
The labor force – the sum of employed and unemployed – grew 476,000 with increases in both components. The labor force participation rate which signals confidence improved to 63.9 percent after falling in January to 63.7 percent. It remains far below the 66.0 percent level at the onset of the recession in December 2007.
The employment-population ratio which measures the percentage of the percentage of the over-16 population which is employed ticked up to 58.6 percent, its highest level since May 2010.
The movement in unemployment rates in most demographic sectors was erratic. While the unemployment rates for adult (over 20) men and women remained flat at 7.7 percent each, the unemployment rate for teenagers (16 to 19) rose 0.6 percentage points to 23.8 percent. The unemployment rate for high school dropouts improved to 12.9 percent from 13.1 percent in January while the unemployment rate for college graduates was unchanged at 4.3 percent.
Since its launch, DS News magazine has positioned itself at the forefront of an
evolving industry. Always current with the most up-to-date
default servicing news, DSNews.com keeps you informed through daily Web casts,
community forums, and a wide range of industry resources.