Jobless Rate Ticks Up, But Job Growth Is Better Than Expected
This post has been updated.
The nation's unemployment rate edged up to 6.7 percent in February from 6.6 percent the month before, but employers added more jobs than expected, the Bureau of Labor Statistics said Friday.
According to BLS, the number of jobs on public and private payrolls grew by 175,000 last month — about 25,000 more than economists had expected.
That employment figure, not the jobless rate, is typically what economists focus more attention on after each month's data are released. They had been expecting to hear that 150,000 or fewer jobs were added in February. The fact that the number was higher "could ease fears of an abrupt slowdown in economic growth," Reuters writes.
There's also a case to be made that the slight rise in the jobless rate was caused, at least in part, by a positive trend: BLS says the size of the civilian labor force grew by about 264,000 and that the number of people classified as "discouraged workers" declined to 755,000 from 837,000.
Those are signs that many Americans are now at least a bit more optimistic about the chances of finding work, and have re-entered the labor force. As they come back into the pool, though, the unemployment rate can edge up even as employers add jobs.
The news was released at 8:30 a.m. ET. We'll have more from the report and reactions to it.
Update at 9:40 a.m. ET. Stocks Rise:
In the first 10 minutes or so after the start of trading in New York, stocks were up slightly. The Dow Jones industrial average, for instance, rose about 60 points — or about 0.3 percent.
Update at 9:25 a.m. ET. Where The Gains Were:
According to BLS:
-- 162,000 of the 175,000 additional jobs were in the private sector.
-- The leisure and hospitality industry increased employment by 25,000.
-- Temporary help firms increased employment by 24,400 jobs.
-- Construction firms, despite the harsh winter weather, added 15,000 jobs.
-- Health care and "social assistance" firms added 14,700 jobs.
-- Manufacturers added 6,000 jobs.
Update at 9:10 a.m. ET. Early Analyses:
-- "Employers added more workers than projected in February, indicating the U.S. economy is starting to bounce back from a weather-induced setback." (Bloomberg News)
-- "The steady pace of hiring last month — it was the biggest increase in three months — suggests the economy has not slowed as much as a recent spate of indicators appear to indicate." (MarketWatch)
Update at 9 a.m. ET. 'Sigh Of Relief':
The news "has people breathing a sigh of relief because it comes on the heels of two very disappointing [jobs] reports, for December and January," NPR's Chris Arnold tells our Newscast Desk.
What's more, those disappointing numbers from December and January are now slightly less disappointing. The bureau reported Friday that it believes 129,000 jobs were added to payrolls in January, an upward revision from its earlier estimate of 113,000. Also, it now believes 84,000 jobs were added in December. That's up from the previous estimate of 75,000.
Update at 8:55 a.m. ET. Stock Market Should Like It:
"This is clearly a report that works in favor of the stock market bulls: continued moderate growth that keeps the [Federal Reserve's] low-rate policies in place, tapering aside," writes The Wall Street Journal's Tom Lauricella. "I suspect we'll be writing 'stocks hit a fresh record high' an awful lot in coming weeks."
Update at 8:45 a.m. ET. Why The Numbers Went In Different Directions:
This has happened before — better-than-expected job growth is accompanied by a rise in the unemployment rate. Once again, the explanations include:
-- The fact that the two figures are produced by different surveys, one of employers and the other (for the jobless rate) of households.
-- The possibility that both numbers were influenced by "good" news. Employers were optimistic enough about the outlook to add workers; and many Americans were optimistic enough about the outlook to start looking for work. But re-entering the workforce, those people increased the supply of available workers more than the boost in employment could absorb — thereby lifting the unemployment rate slightly.
Our original post previewed the report:
The latest news about job growth and the nation's unemployment rate is due at 8:30 a.m. ET.
Economists expect to hear that while the jobless rate stayed at a five-year-low 6.6 percent last month, job growth was relatively weak.
As NPR's John Ydstie reported on Morning Edition, this winter's especially cold weather across much of the nation likely held down hiring — particularly in the construction industry. The Bureau of Labor Statistics is expected to say that about 150,000 jobs were added to payrolls in February.
That would be a modest uptick from January's pace. In its initial report for that month, BLS said employers added only 113,000 jobs to payrolls. But 150,000 jobs is still a small gain in an economy that employs more than 145 million people.
We'll be updating this post as news from the report comes in.