US job creation screeches to a halt in February
US employers added just 20,000 net new positions for the month, only a fraction of what economists had been expecting, while the jobless rate fell two tenths to 3.8 percent, its lowest level since October, according to the closely-watched Labor Department report.
Job creation was the slowest in 16 months, and joins widespread reports from firms nationwide complaining that worker shortages are beginning to impede growth in their businesses.
The decline in the unemployment rate may seem contradictory to the weak job creation, but the figure also reflects a shrinking labor force.
Meanwhile, hourly wages saw their biggest gains in nearly a decade, more evidence of the tight labor market.
The sudden collapse in hiring — with deep job cuts reported in the construction retail and transportation sectors — is sure to spark more concerns about the dwindling supply of American workers.
Economic data can produce the occasional blip due to weather or other one-off factors, and these numbers are subject to revision.
But February marked a dizzying tumble from January’s blow-out 311,000 net new positions — a number the White House had held out as a sign that robust economic growth would continue. Economists had been projecting a 173,000 gain.
The hiring slowdown will be unwelcome news for President Donald Trump, and is like to weigh heavily on first-quarter GDP calculations and threatening to take the bloom from the economy’s rose at the start of 2019.
The US unemployment rate has been hovering 50-year lows since last year, with a hot economy’s hunger for new employees seeming to turn up new pockets of available labor every month.
The construction, retail, mining and transportation sectors shed a combined 45,000 positions while the education sector added only 4,000 workers, down from 64,000 the prior month.
No one was hired in February to work America’s in leisure and hospitality.
Meanwhile, average hourly wages rose 11 cents for the month to $27.66, putting them up 3.4 percent over the same month last year — more than twice as fast as inflation. That is an indication that at long last firms are being force to pay more to attract workers.
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