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February Jobs Numbers Give Some Economists Reason To Smile
Originally published on Fri March 7, 2014 4:29 pm
AUDIE CORNISH, HOST:
From NPR News, this is ALL THINGS CONSIDERED. I'm Audie Cornish.
MELISSA BLOCK, HOST:
And I'm Melissa Block. There was some positive economic news today. Job growth in February was stronger than expected. The government monthly employment report showed 175,000 jobs were added to the economy last month. There were also upward revisions for December and January. As NPR's John Ydstie reports, that improvement comes despite evidence that stormy winter weather may have restrained job growth.
JOHN YDSTIE, BYLINE: Standard & Poor's economist Beth Ann Bovino says we know the weather had an impact on the job market in February because the government asked people about it in its monthly survey of households.
BETH ANN BOVINO: The government asked households, so can you go to work? And if you couldn't go to work, what were the reasons why. There were over 600,000 workers who said they were unable to go to work due to the weather. That was huge.
YDSTIE: Normally in February, only about half that number say the weather temporarily kept them from work. Still, the 175,000 jobs added last month was better than most economists had predicted. John Silvia, chief economist at Wells Fargo, says the report was a pleasant surprise.
JOHN SILVIA: I think it is a very positive signal that while weather has had an impact on job gains in recent months, the underlying strength of the economy is starting to show itself.
YDSTIE: That said, February's job growth was still less than the average monthly job growth for all of last year. The unemployment rate did tick up a notch to 6.7 percent. That's usually a bad sign. But Beth Ann Bovino says not this time because the uptick was caused by people rejoining the labor force.
BOVINO: People coming back to the workforce looking for a job, that could be because of optimism. People left the workforce because they didn't think they could get a job so they just stopped looking. Well, maybe they've come back feeling more confident that they're going to get a job this time around.
YDSTIE: John Silvia agrees.
SILVIA: I take it as good signal, more people looking for employment, that that's actually the traditional signal for an improving economy.
YDSTIE: Another positive sign in this report is a health increase in average hourly earnings in February. Slow wage growth has been restraining consumer spending and the overall recovery. Silvia says this report will likely change some views of where the economy is headed.
SILVIA: I think there was sort of a growing pessimism among some people that the economy was weakening pretty dramatically and I think that's just not playing out. And I think, also, this is very reassuring to the Federal Reserve that, you know, their tapering policy has not had a big negative impact on the economy.
YDSTIE: And that means the Fed is likely to continue dialing back its big stimulus. One negative sign in today's report: an increase in the long term unemployed from 3.6 million to 3.8 million people. Their situation is made more difficult by the expiration of extended unemployment benefits at the end of last year. John Ydstie, NPR News, Washington. Transcript provided by NPR, Copyright NPR.