Granted one month’s data needs to be taken with a grain of salt, but the trend is now pointing decidedly downward.
The U.S. labor market lost 92,000 jobs in February. The unemployment rate ticked up to 4.4%, according to the Bureau of Labor Statistics.
Going into the report, economists had predicted that employers added 50,000 jobs last month. But health care strikes, including 31,000 workers at Kaiser Permanente in California and Hawaii, as well as job losses across a broad swath of industries, in February resulted in the second largest decline in monthly job creation since the pandemic. December jobs gains were also revised down, showing the labor market lost 17,000 positions that month.
Health care, which has been buoying the labor market for months, lost 28,000 positions in February, reflecting major strikes in California and New York. The information sector, which includes tech and media, shed 11,000 positions. Federal government payrolls declined by 10,000. Transportation and warehousing, construction, leisure and hospitality, professional and business services, and manufacturing all lost jobs.
Wage growth remained solid in February, rising 3.8% year over year. But the labor participation rate, the share of people either working or searching for work, fell to its lowest level since 2021, to 62%
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The picture that emerges from the data is an economy where employers just aren’t hiring–rather than a recessionary economy where companies are shedding jobs. The Federal Reserve’s beige book released this week emphasized solid staffing levels but weak hiring, in part due to muted consumer demand tied to rising prices.
Photo by Karolina Grabowska on Unsplash
