The Labor Department reported that there were 273,000 jobs added in February. This was more than the consensus estimate of 175,000 and marked the 113th consecutive month of job gains. For all of 2019, average monthly gains were less at 178,000. For 2018, monthly gains averaged 193,000 and for 2017, monthly gains averaged 176,000. The latter data points were revised from prior estimates.
Revisions also added several jobs to the prior two months. The change in total nonfarm payroll employment for December was revised up by 37,000 from 147,000 to 184,000 and the change for January was revised up by 48,000 from 225,000 to 273,000. Combined, 85,000 jobs were added to the original estimates. Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors. After revisions, job gains have averaged 243,000 over the last three months.
Health care added 32,000 jobs in February and has added 368,000 jobs in the past twelve months.
The January unemployment slipped back to 3.5% in February from 3.6% in January. The underemployment rate was 6.9% from 6.7%.
Average hourly earnings for all employees on private nonfarm payrolls rose in February by nine cents to $28.52. Over the past 12 months, average hourly earnings have increased by 3.0%. For 2018, the year over year pace was 3.0% and in 2017 it was 2.6%. Reasons why wages are not growing faster include the retirement of highly paid baby boomers and relatively weak productivity growth.
The labor force participation rate, which is a measure of the share of working age people who are employed or looking for work inched up to 63.4% in January from 63.2% in December, which had been the highest since August 2013.
Combined, the significant upward revision to the December and January jobs figures plus the strong February employment gains place the economy in a position of strength ahead of the potential and likely negative economic impacts associated with the Coronavirus. Despite the relatively good news on the job front, the market paid little attention to the report, with all eyes on the spread of illness across the globe. The Federal Reserve is expected to lower rates again as it shores up the economy, after the surprise 50 basis point decline announced earlier in the week. The timing is uncertain, but some expect another cut prior to the next FOMC meeting scheduled for March 17 – 18, 2020.