Both the household survey and the employer survey continue to show marked improvements in the health of the job market. For the eighth successive month, the two BLS surveys show noticeable gains in employment. The employer survey shows total payrolls increased 227,000 in February. This is the third month in a row in which payrolls rose more than 200,000.
The household survey shows an even more impressive performance. The number of respondents in that survey who say they hold a job increased 428,000 in February. Making an adjustment for the new population weights used by the BLS in January, it appears that employment gains in the household survey have averaged 388,000 a month since October. The nation needs between 90,000 and 100,000 additional jobs every month to keep up with the growth in the working-age population. Job gains since last summer have comfortably exceeded that threshold. As a result, the unemployment rate has fallen 0.8 percentage points since last August.
The jobless rate remained unchanged in February, not because employment gains slowed, but because working-age Americans streamed back into the labor force. Almost a half million adults entered the workforce last month, a number that modestly exceeded the impressive rise in employment. As a result, the number of adults classified as unemployed increased 48,000 in February. This should not be interpreted as a bearish signal, however. Instead, it offers an indication that many jobless Americans have become more optimistic about their chances of finding a job and started to look for work.
The private sector accounted for all of February’s job gains. Government employment edged down, though the decline was only 6,000. Employment losses in the public sector have slowed in recent months compared with the pace of job loss earlier last year. Manufacturing employment increased 31,000 in February, accounting for about one in seven new jobs. Sizeable job gains were also registered in professional and business services, education and health care, and the lodging and food service industries. A heartening sign is the continued strength of the temporary help industry, which added 45,000 workers in February. Payroll changes in this industry often provide a signal of employers’ hiring intentions in future months. The improvement in temporary help payrolls suggests that many employers remain optimistic about their prospects. Construction employment stumbled, falling 13,000 in February. The construction industry has recovered few of the jobs it lost in the recession, and payrolls in that industry remain more than a quarter below their level just before the recession.
Aside from the continued problems in construction, it is hard to see any weakening of the recent positive trend in the February jobs report. The trend is very much in the right direction, though the nation has a long way to go before getting back to full employment.