Friday, March 5, 2021

February jobs report: strong growth with a few blemishes


 - by New Deal democrat

  • +397,000 million jobs added: 465,000 private sector minus - 86,000 government. The alternate, and more volatile measure in the household report indicated a gain of 208,000 jobs, which factors into the unemployment and underemployment rates below.
  • U3 unemployment rate declined 0.1% at 6.2%, compared with the January 2020 low of 3.5%.
  • U6 underemployment rate was unchanged at 11.1%, compared with the January 2020 low of 6.9%.
  • Those on temporary layoff decreased 517,000 to 2,229,000.
  • Permanent job losers decreased 6,000 to 3,497,000.
  • December was revised downward by 79,000, while January was revised upward by 87,000, for a net gain of 38,000 jobs compared with previous reports.
Leading employment indicators of a slowdown or recession

I am still highlighting these because of their leading nature for the economy overall.  These were mixed but more positive than negative: 
  • the average manufacturing workweek decreased to 40.2 hours. This is one of the 10 components of the LEI.
  • Manufacturing jobs increased by 21,000. YoY manufacturing has still lost -561,000, or 4.4% of the total. About 60% of the total loss of 10.6% has been regained.
  • Construction jobs decreased by 61,000 (probably reflecting poor weather, even for winter, in places like Texas in February) . YoY -175,000 construction jobs have been lost, 4.0% of the total. About 75% of the worst loss of 15.2% loss has been regained.
  • Residential construction jobs, which are even more leading, *rose* by 5,300. YoY there have been actual job gains, and employment in this sector is at another new 10 year+ high.
  • temporary jobs increased by 52,700. YoY, there have still been 175,100 jobs lost, or 6% of all temporary help jobs.
  • the number of people unemployed for 5 weeks or less declined by -93,000 to 2.185 million, compared with last April’s total of 14.283 million.
  • Professional and business employment rose by 63,000, which is still 771,000, or about 3.6% below its peak one year ago.

Wages of non-managerial workers
  • Average Hourly Earnings for Production and Nonsupervisory Personnel: rose $0.04 to $25.19, which is a 5.1% YoY gain. This is at a level not seen in the past 10 years outside of the first months of this pandemic and also January. Relative gains in this measure reflect that job losses during the pandemic have occurred primarily among lower wage earners.

Aggregate hours and wages:
  • the index of aggregate hours worked for non-managerial workers declined by -0.8%, with a YoY loss of -6.3%.
  •  the index of aggregate payrolls for non-managerial workers declined by -0.7%, with a YoY loss of -0.8%. Still, about 90% of the loss from last February to April has been made back up.

Other significant data:
  • Full time jobs gained 301,000 in the household report.
  • Part time jobs declined 456,000 in the household report.
  • The number of job holders who were part time for economic reasons increased by 134,000 to 6.088 million, with a YoY increase of 1,690,000, or 39.5%.


This was generally a positive report, with resumed good growth in the headline employment number and another decline in the unemployment rate. Most internals were positive, including the manufacturing, residential construction, and temporary employment sectors, with a decline in both temporary and permanent layoffs, and an increase in full time jobs. 

The negatives were the surprise decline in the manufacturing workweek, and anomalous declines in both aggregate hours and payrolls. Involuntary part time employment also rose slightly. I am discounting the decline in construction jobs for weather-related reasons.

We are still about 9.5 Million jobs behind where we were one year ago just before the pandemic hit. Even if we were to continue adding jobs at this month’s rate, it would take 2 full years just to get back to that level. The good news, I think, is that with vaccinations picking up speed, the economy is set to really surge by summertime, and hopefully there will be even stronger jobs growth as that happens.