U.S. employers continued their rapid hiring in February, new government data showed Friday, a sign of the nation’s economic durability during a tumultuous global slowdown.
The U.S. added 242,000 jobs as the unemployment rate held at 4.9 percent, the lowest mark during the seven-year recovery from the Great Recession.
That pace, consistent with gains over the last year, indicates Americans are returning rapidly to the labor force, helped by steady consumer spending that is bolstering demand and prompting employers to expand their workforces. In data released Friday by the Department of Labor, sluggish wages provided the only disappointing note — a signal that labor market still has room to improve.
Though stock markets from New York to Shanghai have signaled alarm bells about the stability of the global economy — particularly amid a period of volatile oil prices and diminished demand in China — the U.S. performance of late is likely to boost confidence among investors.
“The financial markets’ panic over a possible recession in the U.S. has been misplaced, if the string of jobs reports are any indication,” said Mark Hamrick, a senior economic analyst at Bankrate.com.
The data also showed improved jobs numbers for December and January. Combined, gains in those months were revised upward by 30,000.
In remarks Friday afternoon, President Obama highlighted the economy's performance and said that American businesses were “creating jobs at the fastest pace since the 1990s.”
February's increase beat the expectations of economists, who had predicted the U.S. created 191,000 new jobs for the month. U.S. stock markets showed modest gains on the news.
The U.S. has now posted 65 consecutive months of uninterrupted jobs gains; in all but eight of those months, payrolls have exceeded 100,000, the total necessary to keep pace with population growth. In that span, the unemployment rate has fallen from 9.5 percent.
“Look at new car sales. Look at the fact that more people are entering the labor market. They’re buying homes. They’re going out to dinner,” Department of Labor Secretary Thomas Perez said in an interview. “These are all indicators of an economy that continues to move in the right direction and weather the headwinds.”
But the true gains of that leap have also been questioned on the campaign trail, and several Republican candidates have found support by voicing anger about the state of the economy, particularly given years of wage stagnation and a steady outflow of manufacturing jobs. Obama on Friday made a pitch to ignore the “Doomsday rhetoric” about “how terrible America is.”
“The American people should be proud of what they have achieved,” he said, “because this speaks to their resilience, innovation, creativity, risk-taking and grit.”
If there was any reason for pessimism, it came in wages: The average hourly salary dipped three cents between January and February, to $25.35. That decline offset what had been several months of strong wage increases — suggesting employers were beginning to compete more aggressively for workers and raising pay as a result. If that trend intensifies, it would help lift the U.S. from a prolonged period of stagnation that has, for many Americans, made the recovery feel unsatisfying.
Economists say that wage data can be volatile from month to month. In January, wages showed their greatest monthly spike in a year. Taking February’s decline into account, wages for Americans have risen 2.2 percent over the last 12 months, just a tick above the pace maintained throughout the recovery. The number suggests that a degree of slack remains, but the labor market is also tightening.
“I think the realization is finally hitting home, and we’re seeing quite a few employers reevaluate their wage structure, and paying a premium for candidates that they weren’t maybe willing to pay for even three or four months ago,” said Amy Glaser, a senior vice president at Adecco Staffing, a company that pairs with businesses to help them find and recruit workers.
A separate survey of households showed that the nation’s job force expanded by more than half a million people — a sign that improving conditions are drawing in those who had previously been on the sidelines. After hitting a low point in September, the labor force participation rate — the share of people holding down jobs or seeking them — has since bounce up half a percentage point, to 62.9 percent.
The participation rate has been pulled downward to historical lows in part because of a wave of Baby Boomer retirements. But, to the bafflement of some labor market analysts, middle-aged workers were also exiting. Those workers have started to reenter over the last half-year.
“There was this big question: Are those workers ever going to come back? Now it looks like we’re seeing it,” said Harry Holzer, a professor of public policy at Georgetown University and author of the book, "Where Are All the Good Jobs Going?" “And it’s been going on consistently since October. So it doesn’t look like a blip anymore. That seems important to me.”
Job growth in February was strong in the education and health services sector, where monthly gains were at their highest level since 2004. But the mining industry continued to shed jobs, a response to the protracted period of low oil and natural gas prices. Employment in the industry decreased by 19,000 in February; over the last year, 140,000 jobs have been lost.
Still, the overall jobs progress, coupled with recent better-than-expected manufacturing readings, makes it more likely that the Federal Reserve will raise interest rates again this year. But for now, Wall Street is betting heavily that the central bank won’t move at its next meeting later this month. Robert Kaplan, the president of the Federal Reserve Bank of Dallas, said Thursday that the fragility in the broader global economy is a reason for the central bank to tread carefully.
“The Fed needs to show patience in decisions to remove accommodation,” he said in a speech.