The labor market in February showed a stable growth: employers added 273 000 jobs despite the slowing economy, lack of jobs and concerns related to the coronavirus. About it writes USA Today.
The unemployment rate fell from 3.6% to 3.5%, which corresponds to a 50-year low.
Employment growth in December and January was revised a total of 85 000. The level for December has increased from 147 000 to 184 000 and Jan — from 225 000 to 273 000.
Many economists say that the concerns related to the coronavirus, it is unlikely to significantly affect the totals of the number of jobs in February, as the outbreak did not start to have a greater impact on the economy and the stock market before the end of February. However, due to coronavirus-related factors can dramatically decrease wages in the coming months.
Before there are fears about the epidemic, the credibility of the business is still maintained due to the weakening of trade tensions with China after the signing of the first phase of dogovorennostey.
The reason for the growth of employment was also unusually light snowfall and historically low unemployment, which led to a shortage of workers and probably prompting some firms to move the season of spring recruitment until the end of winter.
Maybe helped a little the process of hiring workers for the census 2020: added 8000 jobs.
But many economists expect in the coming months the labour market will soften with the growth of the economic consequences of the outbreak of coronavirus. Over the past two weeks, the industrial index Dow Jones has experienced strong fluctuations, falling on Thursday, March 5, nearly 1,000 points on fears about the ultimate impact of the epidemic on the economy. To soften the blow, the Federal reserve reduced the rate by half a percentage point.
“Sales in the stock market, the weakening global demand, strained supply chains and increased economic uncertainty will affect the mood of the business and their ability to withstand storms,” said Morgan Stanley.
Before the virus began to cause increasing concern, economists expect monthly job growth reduced from 175 000 in 2019 to just over 100,000 by the end of 2020 due to slower economic growth and fight the employers for finding workers.
Wages are rising
Average hourly earnings increased by 9 cents to $28,52, reducing annual growth from 3.1% to 3%.
After increasing to 3.5% at the end of 2018, the wage increases fluctuated around 3%, despite falling unemployment.
Moderate income constrained revenues, but also helped to contain inflation, allowing the Federal reserve to repeatedly cut interest rates since the summer of 2019.
Industries that hire employees
Industry education and health has created 56 000 jobs. Leisure and hospitality — 51 000; professional and business services — 41 000; financial activity — 26 000.
Construction added 42 000 jobs, which is the second largest measure of performance. Production increased by 11 000, despite the early failures in the supply chain caused by the outbreak of coronavirus, and to stop production of the Boeing 737 Max after two catastrophic accidents. Some manufacturers may lay off workers because the outbreak continues to hamper the supply of parts from abroad.
The share of Americans working or looking for work, remained at 63.4% for the second month in a row, the highest level since June 2013. This reflects favourable developments in the labour market, which attract the Americans.
What does it mean
Since the end of February the spread of coronavirus a global scale had a negative influence on the markets and increased the chances of recession. Factory repair parts and retail goods remain in China. Although the outbreak in the USA was limited, there is a risk of more rapid spread.
Economist Lydia Busser from Oxford Economics said the fed is expected to reduce interest rates by a quarter percentage point in March and April.