Roughly 275,000 jobs were added to the U.S. economy in February, but an increase in job losses resulted in the unemployment rate rising to 3.9%, according to the U.S. Bureau of Labor Statistics.
Job gains occurred in health care, in government, in food services and drinking places, in social assistance, and in transportation and warehousing.
The number of unemployed people increased by 334,000 to 6.5 million, according to the BLS.
A year ago, the jobless rate was 3.6% and the number of unemployed was 6.0 million.
Among the unemployed, the number of permanent job losers increased by 174,000 to 1.7 million in February.
The number of long-term unemployed (those jobless for 27 weeks or more), at 1.2 million, was little changed. The long-term unemployed accounted for 18.7% of all unemployed people.
The labor force participation rate was 62.5% for the third consecutive month, and the employment-population ratio was little changed at 60.1%.
Wages increased, with the average hourly rate for all employees on private nonfarm payrolls edging-up by 5 cents to $34.57, following an increase of 18 cents in January.
The average hourly wage was up 0.1% compared with January, and up 4.3% over the year.
In February, average hourly earnings of private-sector production and nonsupervisory employees edged up by 7 cents, or 0.2%, to $29.71.
Ksenia Potapov, economist for First American, notes that “the increase in the number of unemployed workers in February came primarily from permanent job losers, which increased by 174,000. However, it was followed by re-entrants to the labor force, which increased by 112,000, which is positive.”
“The signals from this jobs report are similar to those from the January JOLTS data,” Potapov says. “The hires and quits rates are both below their pre-pandemic rates. Fewer workers are changing jobs as hiring cools. The layoff rate, however, remains lower than pre-pandemic, while job openings remain high.
“All signs point to a slowly cooling, but strong, labor market. When the FOMC convenes later this month, they will issue new guidance and projections for economic conditions,” Potapov says. “This jobs report is unlikely to materially change the Fed’s expectations for economic conditions and any potential interest rate moves.
“The Fed expects rate cuts later this year, but wants to see more evidence that inflation is slowing,” she adds. “For the housing market, this suggests the boost from lower mortgage rates likely won’t materialize until well after the traditional spring home-buying season begins.”
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