US adds 311,000 New Jobs last Month

Employers added 311,000 jobs last month, a cooler but still strong increase following a revised 504,000 gain in January, the Labor Department reported Friday. The unemployment rate rose to 3.6% last month from January’s 3.4% as more people sought work.

More Americans ages 25 to 54 jumped into the labor force, and according to Jobs Interface’s CEO, Terry Woodson,

This is giving companies more workers to choose from and is taking some pressure off wage growth”. Wages barely changed in February from January’s figures.

Jobs Interface’s CEO, Terry Woodson

Nearly a year after the Federal Reserve started rapidly raising interest rates to fight high inflation by slowing economic activity, notable dents are being noticed in some areas of the economy, like housing and manufacturing.

But other recent reports showed hiring and spending surged in January, while inflation held firm.

Job growth at some companies is more than offsetting cuts announced by large employers such as Facebook parent Meta Platforms Inc., Google parent Alphabet Inc., Amazon.com Inc. and Walt Disney Co.

Large parts of the labor market—including restaurants, hospitals and nursing homes—are driving the growth. Those service providers were hit hardest by social-distancing measures at the onset of the pandemic.

Now, nearly three years later, they are hiring at a rapid clip as they find it easier to recruit and fill openings, helping fuel an extended stretch of outsize hiring gains.

“Overall the economy remains strong, especially the service side,” said Eugenio J. Alemán, chief economist at Raymond James.

Employers that hired aggressively earlier in the pandemic in industries—such as transportation and warehousing, finance and the tech-heavy information sector—cut employees last month. Workers’ average weekly hours have been trending downward for about two years and ticked down in February, a sign of some cooling in the labor market.

There are indications that strong hiring could continue. Employers had 10.8 million open jobs in January, down slightly from 11.2 million in December. The totals are nearly double the number of unemployed people seeking work and still far above prepandemic levels.

Staffing levels at Joe’s Real BBQ in Gilbert, Ariz., are up from a pandemic low in 2021, but the restaurant could still use more employees. That would help ease the workload for current employees, particularly on busy weekend days such as Super Bowl Sunday, when customers flooded in for St. Louis ribs, operating partner Tad Peelen said.

We still feel the pinch, if we had those 20 folks that I would love to hire, it would have felt a little easier.

Tad Peelen

To help attract workers, the company has raised average wages to about $21 an hour from roughly $17 in early 2020 before the pandemic hit, Mr. Peelen said.

Average hourly earnings for private-sector workers rose 4.6% over the 12 months through February, below a recent peak last March of 5.9%.

Wage growth is still running above prepandemic levels but is cooling as more Americans seek work. Women have been helping propel the recent labor-force recovery, reflecting the fading of pandemic disruptions, including virtual schooling and daycare closures.

Stronger labor-force participation is helping companies fill open jobs and counter fast-rising wages, better aligning the labor market with the Fed’s goal of lowering inflation.

After holding the benchmark federal-funds rate near zero through much of the pandemic, Fed officials lifted the rate more over the past 12 months than any time since the early 1980s, most recently to a range between 4.5% and 4.75% last month.

So far, companies in many industries have continued to hire despite higher interest rates.

Chris Ashcraft, owner of four Express Employment Professionals staffing offices in Alabama, Georgia and Florida, said auto companies including car manufacturers have a backlog of orders they are trying to fill as they recover from supply-chain issues. That is helping support their demand for workers, he said.

Mr. Ashcraft is trying to find workers for a range of companies including shipbuilders, electrical suppliers and steel mills.

We haven’t heard anything about anybody laying people off. Though recruiting for certain positions such as welders and machinists is difficult, more workers are seeking jobs now than earlier in the pandemic.

Chris Ashcraft

From the WSJ