US employers created 262,000 jobs last month, the biggest gain in four months and double January's pace, as auto workers returned from temporary layoffs and construction activity snapped back from a cold January, the government said on Friday. The unemployment rate, however, rose to 5.4 percent from January's 5.2 percent, but the gain partly reflected an increase in workers entering the labour force, the Labour Department said.
The median forecast of Wall Street economists polled a week ago was for a non-farm payroll gain of 220,000 jobs, but on Thursday a big jump in a measure of service-sector employment led some traders to brace for a stronger number. Forecasters had expected the jobless rate to hold steady.
Overall, the report showed a welcome pick-up in job creation, which had been somewhat sluggish in the prior three months.
Some analysts viewed the report as a potential turning point toward a better pace of job creation. Others, though, said the report was not as strong as the 262,000-job gain would suggest.
"Considering the below-trend growth in December and January, the bounce in February is looking anaemic," said Christopher Low, chief economist at FTN Financial in New York.
US manufacturers added 20,000 workers to their payrolls in February, the biggest gain since August. The head of the Bureau of Labour Statistics, Kathleen Utgoff, said much of the gain reflected auto workers returning from temporary layoffs.
In addition, construction jobs shot up by 30,000 after holding steady in January. Utgoff said construction hiring in January was likely restrained by unusually severe weather.
The service side of the economy produced 207,000 news jobs. Professional and business services created 81,000 new positions, reflecting in part a 30,000 gain in temporary jobs. Government payrolls increased by 33,000.
The department said the length of the average workweek held steady at 33.7 hours, but an index of overall hours worked - a measure of total work effort that takes into account the increase in payrolls - continued to edge higher.
The department said hourly earnings were unchanged at $15.90, after a 5 cent-gain in January.
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