The Goldilocks narrative relating to the U.S. economy continued strongly into February. Indeed, the February payrolls report provided another round of good news for the American economy.
Specifically, not only had job growth accelerated sharply, but there also was a modest deceleration in the year-over-year change in average hourly earnings from 2.8% in January to 2.6% in February.
In other words, those who worry about the tight American job market creating escalating wage-push inflation increases have to agree that annual wage gains of only 2.6% is still remarkably low given the state of the nearly fully employed economy.
In February nonfarm payrolls surged by 313,000, and over the past three months, the jobs expansion has averaged 242,000 per month. In February there were strong job gains in construction, retail trade, professional and business services, manufacturing, financial activities, and mining.
It is also interesting to look at household survey job numbers. According to the latest survey, in January the U.S. economy created 518K jobs and a striking 806K jobs in February.
While economists tend to rely more on the payroll survey for employment trends, nonetheless the household survey also confirms that there was been a spectacular surge in job creation over the last two months.
The unemployment rate was 4.1% in February, for the fifth consecutive month, and the number of unemployed persons was essentially unchanged at 6.7 million. The U6 unemployment rate, which accounts for unemployed and underemployed workers, was 8.2%, also unchanged from January.
