By NELSON D. SCHWARTZ
Bolstered by a healthier private sector, the United States economy gained 236,000 jobs in February, well above what had been expected, while the unemployment rate fell to 7.7 percent, its lowest level since December 2008.
The gains were broad-based, the Labor Department said Friday, with sectors ranging from manufacturing to business services turning in healthy results. Construction was especially strong, adding 48,000 jobs, a sign that the recovery in the housing market is beginning to translate into new jobs.
Public-sector employment continued to shrink, however, as the number of government employees nationwide fell by 10,000.
While many economists were encouraged by the report, some noted that the size of the labor force contracted by 130,000. Some of that was because of retirements, but some was also a result of discouraged workers giving up the search for jobs.
As a result, the labor participation rate sank to 63.5 percent, a low for the current economic cycle.
At the current rate of job creation, unemployment could actually crack the 7 percent level by the end of the year. However, economists expect the budget cuts now under way in Washington to contribute significant headwinds in the months ahead. The so-called sequester went into effect March 1.
“We think we’ll see some slowdown in April and May because of the sequester,” said Michelle Meyer, senior United States economist at Bank of America Merrill Lynch. “We’re going to see federal job cuts and the spring is going to be a soft patch for the labor market.”
She estimated that the unemployment rate would stabilize at about 7.5 percent later this year.
The unemployment fell from 7.9 percent in January. Economists had been expecting the economy to add 165,000 jobs in February, with no movement in the rate.
After peaking at 10 percent in October 2009, the unemployment rate fell steadily for three years but has been stuck at just below 8 percent since last September.
The pace of hiring in February represented an acceleration from the previous four months, when the economy added jobs at a monthly rate of 190,000.
The budget cuts in Washington are expected to reduce federal unemployment benefits by about 10 percent. State benefits, which cover the first 26 weeks of unemployment in most states, will not be affected by the federal budget squeeze.
Dan Haney has worked occasionally since he was laid off from his job as a customer service representative two years ago, but lately the hunt for work has proved fruitless, and he is concerned about what would happen if his unemployment benefits were reduced.
“At this point, I have to take what comes down the pike,” said Mr. Haney, who is 54 and lives in Philadelphia. “I’m on the computer every day looking for jobs.”
A high school graduate, Mr. Haney has some computer training but lacks a college degree, which has made finding a job all the more difficult.
“Some of these entry-level jobs say college is preferred,” Mr. Haney said. “Why do you need a college degree to answer a phone?”
Friday, March 8, 2013
Unemployment at 4-Year-Low as U.S. Hiring Gains Steam
By NELSON D. SCHWARTZ
Bolstered by a healthier private sector, the United States economy gained 236,000 jobs in February, well above what had been expected, while the unemployment rate fell to 7.7 percent, its lowest level since December 2008.
The gains were broad-based, the Labor Department said Friday, with sectors ranging from manufacturing to business services turning in healthy results. Construction was especially strong, adding 48,000 jobs, a sign that the recovery in the housing market is beginning to translate into new jobs.
Public-sector employment continued to shrink, however, as the number of government employees nationwide fell by 10,000.
While many economists were encouraged by the report, some noted that the size of the labor force contracted by 130,000. Some of that was because of retirements, but some was also a result of discouraged workers giving up the search for jobs.
As a result, the labor participation rate sank to 63.5 percent, a low for the current economic cycle.
At the current rate of job creation, unemployment could actually crack the 7 percent level by the end of the year. However, economists expect the budget cuts now under way in Washington to contribute significant headwinds in the months ahead. The so-called sequester went into effect March 1.
“We think we’ll see some slowdown in April and May because of the sequester,” said Michelle Meyer, senior United States economist at Bank of America Merrill Lynch. “We’re going to see federal job cuts and the spring is going to be a soft patch for the labor market.”
She estimated that the unemployment rate would stabilize at about 7.5 percent later this year.
The unemployment fell from 7.9 percent in January. Economists had been expecting the economy to add 165,000 jobs in February, with no movement in the rate.
After peaking at 10 percent in October 2009, the unemployment rate fell steadily for three years but has been stuck at just below 8 percent since last September.
The pace of hiring in February represented an acceleration from the previous four months, when the economy added jobs at a monthly rate of 190,000.
The budget cuts in Washington are expected to reduce federal unemployment benefits by about 10 percent. State benefits, which cover the first 26 weeks of unemployment in most states, will not be affected by the federal budget squeeze.
Dan Haney has worked occasionally since he was laid off from his job as a customer service representative two years ago, but lately the hunt for work has proved fruitless, and he is concerned about what would happen if his unemployment benefits were reduced.
“At this point, I have to take what comes down the pike,” said Mr. Haney, who is 54 and lives in Philadelphia. “I’m on the computer every day looking for jobs.”
A high school graduate, Mr. Haney has some computer training but lacks a college degree, which has made finding a job all the more difficult.
“Some of these entry-level jobs say college is preferred,” Mr. Haney said. “Why do you need a college degree to answer a phone?”
No comments:
Post a Comment