The Labor Department released the February jobs report with higher than expected job gains but slowing wage growth.
313,000: The U.S. added 313,000 jobs in February.
4.1%: The unemployment rate remained steady at 4.1 percent.
2.6%: Wages rose 2.6 percent over the past year.
February’s jobs report has a lot of good news. The 313,000 jobs added to the economy beat economists’ expectations. The number also marks the fastest pace of job growth in a year and a half according to the Wall Street Journal. Hiring was also spread across industries. Retail, which struggled at the end of 2017, gained 50,000 jobs in February. Professional and business services and manufacturing also saw strong job growth.
The 4.1 percent unemployment has remained steady for the past four months, and it’s the lowest unemployment rate in 17 years. The labor market participation rate ticked up to 63 percent in February, which is its largest jump in three years according to CNN. This shows that economy is still strong enough to pull in sidelined workers, without increasing the unemployment rate.
The 2.6 percent wage growth in February can either be good or bad news depending on who you’re asking. Wage growth did slow from January, which is disappointing for workers and more in line with the sluggish wage growth that’s remained consistent throughout the recovery from the Great Recession. However, according to the New York Times, the lower wage growth quiets concerns about inflation.
The biggest question right now is how much room for growth is left in the economy. Despite the strong numbers in January’s jobs report, investors were concerned about inflation, which resulted in large stock market losses. However, February’s report indicates that there is still plenty of room to grow.
“Over the last 2 months, the job market has absorbed 1.3 million new entrants into the labor force, allowing the unemployment rate to stay at 4.1% – a remarkable testament to the underlying strength in this economy,” David Donabedian, chief investment officer of CIBC Atlantic Trust told the Wall Street Journal.