Although the unemployment rate remained high, job creation in February topped expectations and pointed to a still vibrant U.S. labor market.
Nonfarm payrolls rose by 275,000 for the month, while the unemployment rate rose to 3.9%. Economists polled by Dow Jones expected payroll growth of 198,000, a step slower than a downwardly revised gain of 229,000 in January. December's gain was also reduced to 290,000 from 333,000.
The labor force participation rate remained stable at 62.5%, but the unemployment rate increased.
Average hourly earnings, a closely watched indicator of inflation, showed a slightly smaller-than-expected increase for the month and a decline from a year ago. Wages rose just 0.1% in the month, a tenth of a percentage point above estimates, and rose 4.3% from a year ago, below the 4.5% gain in January and slightly below estimates of 4.4%.
Markets showed little reaction to the news, with futures tied to flat major averages. However, Treasury yields fell sharply.
“It's got a data point for every view on their spectrum,” Liz Ann Saunders, chief investment strategist at Charles Schwab, said of the report.
Job creation is skewed toward part-time positions. Full-time jobs fell by 187,000, while part-time jobs rose by 51,000, the household survey said. That figure is used to calculate the unemployment rate and showed a decline of 184,000 in total employment.
From a sector standpoint, health care led to 67,000 new jobs. The government was again a big contributor, with 52,000, restaurants and bars up 42,000 and social assistance up 24,000. Other gains include construction (23,000),
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