PeopleScout Jobs Report Analysis—February 2023

PeopleScout Jobs Report Analysis—February 2023

U.S. employers added 311,000 jobs in February, a slowdown from January but still beating economist expectations. The unemployment rate rose slightly to 3.6%. Year-over-year wage growth rose to 4.6%.

jobs report infographic

The Numbers

311,000: U.S. employers added 311,000 jobs in February.

3.6%: The unemployment rate rose to 3.6%.

4.6%: Wages rose 4.6% over the past year.

The Good

As the Wall Street Journal reports, February’s jobs report demonstrates surprising economic resilience, despite continuing pressures. While some companies, particularly in the technology sector, have cut jobs in recent months, other sectors have more than made up for the job losses. Leisure and hospitality and education and health services led February’s growth.

While some experts have raised concerns about the consistently strong job growth in the face of high inflation and rising interest rates, others say the labor market may be heading toward a “strong, stable, and sustainable pace of growth.” Helping support this analysis, the labor force participation rate for those ages 25-54 increased in February. This added 400,000 workers to the labor force, easing some pressures.

The Bad

While the momentum has continued in many sectors, others are seeing a more mixed picture, as the New York Times reports. Manufacturing, transportation and warehousing and financial services all shed jobs in February. The continued growth also makes it more likely that the Federal Reserve will consider a bigger interest rate increase at their next meeting on March 21-22.

The Unknown

The big question for March is how the Fed will view the latest jobs data along with other economic indicators. MarketWatch reports that officials had planned to slow the pace of interest rate increases, but the latest numbers show mixed signals. The increase in the unemployment rate and the labor force participation rate could persuade the central bank to stick with its plan for smaller interest rate increases. However, the blockbuster jobs numbers in both January and February will give officials something to consider later this month.

Post by Nicole Fuqua