The job market roared ahead in February, adding to signs that the economic impact of the latest pandemic wave is behind us.
The U.S. economy added 678,000 jobs in February, the Bureau of Labor Statistics said Friday, the most for any month since July and more than the 440,000 economists had anticipated. The back-to-work trend was widespread, with most industries gaining jobs. Fading numbers of COVID-19 cases especially helped the leisure and hospitality sector, which led the way by adding 179,000 positions. The unemployment rate fell to 3.8% from 4%, reaching its lowest level since the pandemic hit and closing in on the 3.5% seen before the virus emerged.
“The strength of the US labor market was on full display in February as the economy exited the Omicron wave,” Lydia Boussour, lead U.S. economist at Oxford Economics, said in a commentary, referring to the latest variant of COVID-19.
The unexpectedly large increase in jobs means the economy is even closer to digging itself out of its pandemic hole. (Plus, 92,000 more jobs were added in December and January than the government originally reported.) After shrinking by as many as 22 million jobs when the virus first triggered lockdowns, the labor market is now just 2.11 million jobs short of a full recovery.
The solid report makes it even more likely that the Federal Reserve will stick to its plan to start raising the benchmark interest rate later this month, economists said. Why? Because the main thing that would hold the central bank from that inflation-fighting tactic is concern that people are struggling to find a job. This report suggests the economy can handle higher borrowing costs.
One surprising detail is that the average hourly wage barely budged after rising solidly every month since April, perhaps because of the increase in lower-paid jobs in the leisure and hospitality sector.
Have a question, comment, or story to share? You can reach Diccon at email@example.com.