Unemployment rate drops below 9% as the private sector added 222K jobs in February

After sitting back and playing dead for several months, the job market finally posted a healthy gain in payroll jobs for February. The unemployment rate unexpected slipped further below 9% to 8.9%. Overall payroll employment in February grew by 192K, following a revised 63K rise in January and a 152K gain in December. Private nonfarm payrolls were somewhat stronger, increasing 222K in February, following a 68K boost in January. Analysts had projected a 190K advance in the latest month.

By major sectors, the goods-producing numbers look good, showing a 70K jump, following a 35K rise in January. For the latest month, manufacturing jobs advanced 33K after a 53K boost in January. Even better, only 1K of the February gain in manufacturing was for motor vehicles. Construction employment increased 33,000 in February, following a 22,000 decline the prior month. Mining rose 4K in February.

Private service-providing jobs jumped 152K after a 33K increase in January. The latest was led by a gain of 47K in professional and business services with 16K coming from temp help. Health care employment continued to increase in February, expanding by 34K . Transportation and warehousing employment increased by 22K in February, with half of that gain in truck transportation. On the downside, employment in retail trade slipped 8K possibly due to adverse winter weather.

Government jobs fell 30,000, following a 5,000 dip in January.

Today's report is quite encouraging in that a real boost in payroll employment helps to pump up the recovery as the jobs gain will support more consumer spending. The drop in the unemployment rate looks good, but it is not typical of recoveries because, the rate should be increasing from a surge in the labor force as discouraged workers return to the job hunt. Via BLS:
Nonfarm payroll employment increased by 192,000 in February, and the unemployment rate was little changed at 8.9 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in manufacturing, construction, professional and business services, health care, and transportation and warehousing.

Household Survey Data

The number of unemployed persons (13.7 million) and the unemployment rate (8.9 percent) changed little in February. The labor force was about unchanged over the month. The jobless rate was down by 0.9 percentage point since November 2010.

Among the major worker groups, the unemployment rates for adult men (8.7 percent), adult women (8.0 percent), teenagers (23.9 percent), whites (8.0 percent), blacks (15.3 percent), and Hispanics (11.6 percent) showed little or no change in February. The jobless rate for Asians was 6.8 percent, not seasonally adjusted.

The number of job losers and persons who completed temporary jobs, at 8.3 million, continued to trend down in February and has fallen by 1.2 million over the past 12 months. The number of long-term unemployed (those jobless for 27 weeks or more) was 6.0 million and accounted for 43.9 percent of the unemployed.

Both the civilian labor force participation rate, at 64.2 percent, and the employment-population ratio, at 58.4 percent, were unchanged in February. The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was essentially unchanged at 8.3 million in February. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

In February, 2.7 million persons were marginally attached to the labor force, up from 2.5 million a year earlier. (These data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 1.0 million discouraged workers in February, a decrease of 184,000 from a year earlier. (These data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.7 million persons marginally attached to the labor force in February had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities.


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