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US economy adds 379,000 jobs in February | Business and Economy News

3 min read


Well, that’s more like it.

The United States economy added 379,000 jobs in February, the US Bureau of Labor Statistics said on Friday, signaling that the labour market is turning a corner after a brutal close to 2020.

February’s gains were even more impressive given the harsh winter weather that tore through the southern US last month.

And most of the jobs that were added were in leisure and hospitality – the hardest-hit sector of the economy.

Another bright spot – January’s dismal non-farm payrolls figure was revised upward from an anemic 49,000 to modest but improved 166,000.

The unemployment rate for February was little changed at 6.2 percent, while the number of unemployed held nearly steady at 10 million.

The labor force participation rate – which measures the number of people either working or actively looking for a job – also held steady at 61.4 percent.

While February’s headline number was better than expected, the labour market recovery continues to lag a rebound in other parts of the economy.

Some 745,000 Americans filed for first-time unemployment benefits with states last week – 9,000 more than the previous week, the Labor Department said on Thursday.

Weekly jobless claims are a proxy for layoffs, which remain well above their pre-pandemic peak of 665,000 in March 2009.

Many forecasters think the nation’s jobs market won’t be fully healed until 2024.

That could lead to deep scarring for the nation’s unemployed. The longer people are out of work, the more likely their skills are to erode and their networks to dry up – making it even harder to land a job.

But the trend is toward improvement.

The four-week moving average for weekly jobless claims, which smooths out the noise in the data, was 790,750- a decrease of 16,750 from the previous week’s revised average.

And the number of Americans currently collecting jobless benefits – known as continuing claims – was 4,295,000 for the week ending February 20, nearly 100,000 fewer than the previous week.

New COVID-19 infections are now stabilizing and trending down, while the nationwide vaccination drive, although bumpy, is well underway.

States and cities are starting to lift pandemic restrictions. Cinemas and theatres in New York City will re-open to limited capacity on Friday.

And on Tuesday, Texas Governor Greg Abbott announced an executive order to allow businesses in the state to fully reopen.

But lifting restriction is only part of the equation. Consumers also have to feel comfortable enough to start engaging in the types of activity that can get legions of the nation’s unemployed back to work – such as dining out, going to movies, flying and staying at hotels.

Meanwhile, data and other developments suggest the economy is poised to give the jobs market some help.

US household incomes rose 10 percent in January- the second-biggest jump on record – thanks in large part to the $900,000 round of virus relief aid that Congress passed in December.

That contributed to a surge in retail sales in January – crucial for the health of the economy because roughly two-thirds of US growth is driven by consumer spending.

And another economic boost is almost surely in the cards, as President Joe Biden’s proposed stimulus package winds its way through Congress.

The US Senate is set to start debating the $1.9 trillion coronavirus aid bill on Friday.

 





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