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Economy in Brief

U.S. Payrolls Surge in February and Jobless Rate Slips
by Tom Moeller  March 5, 2021

• Leisure & hospitality drives gain in jobs.

• Earnings growth remains moderate m/m.

• Unemployment rate declines to lowest level since March 2020.

As the economy began to reopen more widely after closures due to COVID-19, the job market revived. Nonfarm payroll employment surged 379,000 (-6.0% y/y) during February following a 166,000 January gain, revised from 49,000. A 200,000 increase in February had been expected in the Action Economic Forecast Survey. December's decline was deepened to -306,000 from -227,000. The estimates of the February payroll change ranged from 43,000 to 350,000 amongst 25 forecasters. The survey for the February employment report was taken during the second week of last month.

Average hourly earnings growth of 0.2% (5.3% y/y) last month compared to 0.1% in January, revised from 0.2%. December earnings surged 1.0%. A 0.2% increase had been expected.

The unemployment rate edged lower to 6.2% from 6.3% in January. An uptick 6.4% had been expected. Employment in the household survey rose 208,000 (-5.4% y/y) after increasing 201,000 in January while the labor force edged 50,000 higher (-2.6% y/y) after declining 406,000 in January. The overall jobless rate, including those who were marginally attached or working part-time for economic reasons, held steady at 11.1%, remaining at the lowest point since March of last year.

The employment & earnings data are collected from surveys taken each month during the week containing the 12th of the month. The labor market data are contained in Haver's USECON database. Detailed figures are in the EMPL and LABOR databases. The expectations figures are in the AS1REPNA database.

Employment (SA, M/M Change, 000s) Feb Jan Dec Feb Y/Y 2020 2019 2018
Payroll Employment 379 166 -306 -6.0% -5.8% 1.3% 1.6%
 Previous Estimate -- 49 -227 -- -- -- --
  Manufacturing 21 -14 35 -4.1 -5.0 1.0 2.0
  Construction -61 1 47 -3.8 -3.0 2.8 4.6
  Private Service-Producing 513 103 -356 -6.3 -6.6 1.4 1.5
  Government -86 76 -32 -5.9 -3.1 0.7 0.5
Average Weekly Hours - Private Sector 34.6 34.9 34.7 34.4 34.6 34.4 34.5
Private Sector Average Hourly Earnings (%) 0.2 0.1 1.0 5.3 4.8 3.3 3.0
Unemployment Rate (%) 6.2 6.3 6.7 3.5 8.1 3.7 3.9
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