February job growth surpasses expectations, defies coronavirus fears

Nonfarm payrolls increased by 273,000 in February, surpassing economists’ 175,000 estimate. Unemployment also slightly dropped to 3.5 percent, matching its lowest level in more than 50 years, according to the latest report by the U.S. Department of Labor.

December and January job estimates were also revised upward by a total of 243,000, tying for the best months since May 2018. December moved up from 147,000 to 184,000, while January went from 225,000 to 273,000.

Average hourly earnings grew by 3 percent in 2019, in line with estimates, while the average work week, considered a key measure of productivity, nudged up to 34.4 hours.

Companies have continued to hire despite fears related to the novel coronavirus, according to the report.

Health care and social assistance created the most new jobs, totaling 57,000. Government employment grew by 45,000 due to Census hiring and state government education. Construction added 42,000 jobs; professional and technical services added 32,000; finance added 26,000.

Household employment also increased by 126,000 while those filing for unemployment decreased by 105,000.

“While it’s too early to see the impact of the coronavirus on the labor market, we can say the labor market was in a good place before the virus began to spread,” said Nick Bunker, economic research director at Indeed, told CNBC. “But the next few months will be a test of just how resilient this labor market is.”

“Most of the indicators thus far have shown little damage,” CNBC analysts Yelena Dzhanova and Lauren Hirsch report. “Jobless claims remain well within their recent trend, coming in at 216,000 in the latest reading Thursday. Job placement firm Challenger, Gray & Christmas also reported Thursday that planned layoffs actually fell 16% from January. And key ISM readings on both manufacturing and services show companies still plan to hire.”

Despite stock market drops, they suggest any evidence of the coronavirus economic impact would first be seen in employment data.

President Donald Trump on Monday proposed emergency measures to prevent an economic slowdown and curb fears over the virus. The emergency measures include a temporary payroll tax cut and expanded sick leave.

“We have a very strong economy, but this blindsided the world,” Trump said.

The president’s advisers will urge Congress Tuesday to take action on a “possible payroll tax cut” or other substantial tax relief. He is also moving ahead to propose no-interest loans for small businesses hurt by the coronavirus outbreak and to help hourly wage earners who miss work because of extended illness or shutdown “so they don’t get penalized for something that’s not their fault.”

This article was first published by The Center Square.

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