February Jobs Report Indicates "Steady Resilience" as Economy Continues to Recover

Dr. Bernard E. Anderson
Whitney M Young, Jr. Professor Emeritus, The Wharton School, University of Pennsylvania
Senior Economic Advisor, National Urban League
 
Employment grew by 311,000 jobs in February, while labor force participation grew and long-term unemployment fell, indicating a steady resilience as the economy continues to recover from COVID 19 and the Federal Reserve continues its quest to reduce inflation and restore stable, balanced growth.
 
Most of the 105,000 new jobs were in leisure and hospitality industry. Over the last six months, we’ve seen an average monthly employment growth of 343,000, with women rejoining the workforce in notable numbers and adding strength to the economy. The female ratio of employment is now 49.8%, nearly half of all nonfarm jobs. Higher pay and remote work have spurred more women into employment. White and Black women are equitably sharing the employment gains, but Hispanic women have benefitted most, based on increases in their labor force participation rate. More women seeking jobs might constrain wage increases and help reduce inflationary pressures.
 
However, the unemployment rate edged up to 3.6%, and the Black-white unemployment ratio remained unchanged at 1.78. Workers unemployed 6 month or more declined to 17.6 % of all unemployed. The total jobless rate including discouraged workers remained unchanged at 6.8%. This is due to the decline in job openings and increase in layoffs in January. The total number of job openings are down from 12 million last March but still well above 7 million openings in February 2020. January openings exceeded the 5.7 million unemployed workers seeking jobs by nearly 2 to 1.
 
Financial markets showed the impact of rising rates and moderate economic growth.  Yields on short term treasuries climbed above 5.0 %, producing a clear inverted yield curve, usually a warning of an oncoming recession.  Bond market trends suggest that tighter monetary policy will constrain GDP growth exacerbating financial conditions for both the private and public sectors.
 
The economic outlook remains clouded by the pace of recovery from the COVID 19 pandemic.  Households and businesses can expect a prolonged return to stable, balanced growth .