U.S. adds a strong 242,000 jobs in February

WASHINGTON -- U.S. employers added a robust 242,000 workers in February as retailers, restaurants and health care providers drove another solid month for the resilient American job market.

See Full Article

The unemployment rate remained at a low 4.9 per cent.

The Labor Department on Friday also revised up its estimates of job growth in December and January by a combined 30,000. Over the past three months, employers have added a strong 228,000 jobs.

The gains show that the U.S. economy has weathered a global economic slowdown and falling financial markets without suffering much blowback. The improvement will help ease fears that arose in recent weeks that a new U.S. recession might be looming.

Friday's jobs report is also sure to be closely monitored by the Federal Reserve and presidential candidates as a gauge of how well the economy is extending its 6 1/2-year rebound from the Great Recession.

"Neither global headwinds, financial turbulence nor political uncertainty has dimmed American business' enthusiasm for hiring," said Sal Guatieri, a senior economist at BMO Capital Markets. "The solid jobs report should allay recession fears."

Worker pay did slip last month after having picked up in January. But more Americans who had been sitting on the sidelines began searching for jobs last month and found them.

Employers expect solid consumer demand in the months ahead even though the stock market has turned turbulent, oil prices have hurt energy industry jobs and a stronger dollar has reduced export sales. Stock trading opened slightly lower after the jobs report was released.

Retailers added 54,900 jobs last month. Restaurants and bars added 40,200, the health care sector 38,100 and construction companies 19,000.

Hiring by employers that are directly associated with consumers has more than offset layoffs at manufacturers and fossil fuel companies -- two sectors squeezed by the pressures of uncertainty in China, sluggishness in Europe, declining oil prices and a stronger dollar.

Job losses for the mining sector -- an area that includes the battered energy industry -- have totalled 140,400 in the past 12 months. And manufacturing has added just 12,000 jobs over that time.

Consumers have provided the foundation for much of the job market's improvement in what's become something of a self-sustaining cycle. The nearly 2.7 million workers who have been added over the past 12 months have bolstered spending on autos, housing and meals out.

With unemployment remaining low, economists say more companies should begin to raise pay to attract workers, thereby fueling more hiring and increasing people's ability to spend, invest and save.

For years, one of the key weaknesses of the economic recovery has been tepid pay growth. Over the past 12 months, average hourly earnings have risen 2.2 per cent. Earnings actually fell slightly between January and February in a sign that an expected liftoff in incomes has yet to be achieved.

Economists were searching for explanations because wages had begun picking up in recent months.

"This surprising decline in wage gains may have been due in part to increased demand for lower-paying service jobs, like retail and hospitality jobs, as people frequented the malls and restaurants after the snow melted in February," said Beth Ann Bovino, chief U.S. economist at Standard & Poor's Ratings Services.

But Ian Shepherdson, chief economist at Pantheon Macroeconomics, noted that wages might have slipped last month because the survey for the jobs report occurred before Feb. 15, which is payday for people who are paid semimonthly.

Still, steady hiring in recent months has translated into more consumer spending in several key sectors. Auto sales rose 7 per cent over last February to 1.3 million vehicles, according to Autodata Corp.

Purchases of existing homes rose 0.4 per cent last month to a seasonally adjusted annual rate of 5.47 million, according to the National Association of Realtors. That improvement followed a solid 2015, when sales achieved their highest level in nine years.

And spending at restaurants has risen 6.1 per cent over the past 12 months.

Still, troubles abroad have tempered U.S. economic growth. China, the world's second-largest economy, is struggling with high corporate debts and slower growth. Oil prices have tumbled amid relatively low demand. The strong dollar has crushed exports, while the stock market has dropped in an extended bout of volatility this year.

The Fed is looking for further wage growth. The central bank is considering whether to raise interest rates again in the face of global risks that could imperil broader economic growth. In December, the Fed raised rates from record lows -- its first increase in nearly a decade.

Investors have largely dismissed the likelihood of another rate hike at the upcoming Fed meeting March 16-17.



Advertisements

Latest Economic News

  • DavidsTea swings to loss on charges but says e-commerce improving

    Economic CTV News
    MONTREAL - DavidsTea Inc. says it swung to a loss in its last quarter as onerous contract charges and impairments weighed on its balance sheet. The specialty tea retailer says it had a loss of $16.1 million for the fourth quarter ending Feb. Source
  • Rogers profit rises by more than a third to $425M

    Economic CBC News
    Rogers Communications Inc. reported a $425 million net profit in its first quarter, up 37 per cent from $310 million in the comparable period last year. The wireless, cable, internet and media company's adjusted earnings grew even more, rising by 45 per cent to $477 million under new accounting rules that Rogers began using in the quarter ended March 31. Source
  • Ottawa's new privacy rules give businesses flexibility on reporting data breaches

    Economic CTV News
    OTTAWA -- Federal data breach regulations set to take effect Nov. 1 will require mandatory reporting of security breaches that pose a "real risk of significant harm," but give businesses flexibility about how that's done. Source
  • Spat breaks out between Tim Hortons franchisee factions over public complaints

    Economic CBC News
    The Tim Hortons franchisee advisory board is slamming a group representing at least half of the brand's restaurant owners for publicly making complaints about their parent company Restaurant Brands International Inc. In a letter to franchisees obtained by The Canadian Press, the board argues that the comments by the Great White North Franchisee Association criticizing the company in the media and to the federal government is corrosive and damaging to the Tim Hortons brand. Source
  • Acacia Mining production drops 45 per cent as Tanzania troubles persist

    Economic CTV News
    TORONTO -- A subsidiary of Toronto-based Barrick Gold Corp. says gold production at its Tanzanian operations plunged 45 per cent last quarter as it grappled with export restrictions from the country. London-based miner Acacia Mining, owned 64 per cent by Barrick, says the drop in production resulted from reduced operations at its Bulyanhulu mine and producing mostly from lower-grade stockpiles at its Buzwagi mine. Source
  • Supreme Court beer ruling could apply to Alberta-B.C. pipeline war, experts say

    Economic CTV News
    CALGARY -- A Supreme Court of Canada ruling on bringing beer from Quebec into New Brunswick has implications for the trade war between Alberta and B.C. over the Trans Mountain pipeline expansion. Experts say the court seems to be addressing the issue in its decision when it notes that while some trade barriers can be allowed in some circumstances, those designed to punish another province or to protect a local industry would not be permissible. Source
  • High cost of dental services prompting some patients to seek alternative options

    Economic CBC News
    An unaffordable price tag kept Melanie Laxson out of the dentist's chair until the pain became unbearable. With no access to insurance, the 38-year-old says there's no way she could afford the full cost of a dentist. Source
  • Canadian airline profits will fall in 2018 on higher costs: Conference Board

    Economic CTV News
    MONTREAL - The Conference Board of Canada says the growth of the country's airline industry will slow in 2018 as profits are forecast to decrease from last year's peak primarily because of higher fuel and labour prices. Source
  • Commodities volatile on $100 US oil talk

    Economic CBC News
    Talk that Saudi Arabia has its sights on $80-$100 US a barrel oil again and of more U.S. sanctions on Russia ignited a rally in commodities and resource stocks on Thursday, though the potential boost to inflation hit fixed-income assets. Source
  • Commodities rollercoaster on $100 US oil talk, sanctions stress

    Economic CBC News
    Talk that Saudi Arabia has its sights on $80-$100 US a barrel oil again and of more U.S. sanctions on Russia ignited a rally in commodities and resource stocks on Thursday, though the potential boost to inflation hit fixed-income assets. Source