Job growth in the United States escalated sharply last month in spite of icy weather that gripped a large part of the country. This eased fears of a sudden economic slowdown and kept the Fed on track with its program to taper bond purchases.
In its latest report, the Labor Department says that after creating only 129,000 jobs in January, employers created 175,000 new job opportunities in February. There was, however, an increase in the unemployment rate from 6.6 to 6.7 percent as more Americans started looking for jobs.
The chief economist at Boston-based John Hancock Financial Services, Bill Cheney, said: “It reinforces the case for the economy being stronger than it’s looked for the last couple of months. It makes life easier for the Fed and feeds into continuing the tapering process.”
The report also noted the biggest increase in average hourly wages in eight months. Moreover, the final payrolls count for January and December had to be revised to reflect 25,000 more job opportunities created in those two months than previously accounted for.
Wall Street generally welcomed the report, and the Standard and Poor’s 500 Index increased sharply before receding again, ending the day barely changed.
In spite of the improved results, the labor market has not fully recovered after the recession. The share of US citizens with a job, which is widely used as a barometer for the labor market’s health, remained steady at 58.8 percent in February. It has not increased significantly since the recession.
Gains in job opportunities were broad-based, with the government adding 13,000 new jobs and the private sector adding 162,000. For the seventh month in a row, there was an increase in manufacturing jobs. The figure of 6,000 new jobs created in manufacturing during February was the same as that of January.
The construction industry surprised many observers in January by posting a significant increase in jobs, and the numbers went up by another 15,000 in February. The number of available jobs in the information, retail, warehousing and transportation industries declined, however.
There was an increase of nine cents in average hourly earnings during February.
The chief economist at Charlotte-based Wells Fargo Securities, John Silvia, said: “This gain, along with a rise in jobs, supports our case for better real incomes in 2014 and, thereby, a better outlook for consumer spending.”
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