U.S. Extends Its Run of Strong Job Growth Another Month ( Emily Tam )

In yet another sign of a strengthening recovery, the United States added 227,000 net jobs in February, the third consecutive month of gains over 200,000. The unemployment rate was unchanged from 8.3 percent in January, the Labor Department reported Friday, as nearly a half million people who had been staying on the sidelines rejoined the search for work.

The strong job growth numbers could bolster President Obama’s effort to make the case to voters that his economic policies are working.

“Today’s employment report provides further evidence that the economy is continuing to heal from the worst economic downturn since the Great Depression,” said Alan B. Krueger, the chairman of the White House’s Council of Economic Advisers.

Republicans, for their part, immediately declared that progress was too slow and attacked President Obama for what they called his “job-killing policies,” hammering him on what they said was his refusal to help ease gas prices by blocking projects like the Keystone pipeline from Canada to Texas.

“Three years of ‘stimulus’ spending, tax hikes and excessive government regulations have left us with unemployment that has remained above 8 percent for 37 consecutive months, and Americans are increasingly worried about the amount of debt owed to countries like China,” said House Speaker John Boehner, a Republican from Ohio.

But economists greeted the report with almost unequivocal optimism. “There is no real cloud in the silver lining of this morning’s jobs report,” wrote Steven Blitz, chief economist of ITG investment research.

Patrick O’Keefe, director of economic research at J. H. Cohn, an accounting and consulting firm, said the recent run of gains was approaching “escape velocity,” adding, “The jobs recovery will finally have achieved the momentum that is necessary.”

The report followed a flurry of positive economic reports about the American economy, including a continued rise in consumer confidence and growing strength in the manufacturing sector.

Signs of a recovery have been here before — last February, March and April saw net gains of more than 200,000 jobs each month. But then the effects of high gas prices, the earthquake in Japan and the resurgence of the fiscal woes in Europe kicked in, slowing job growth to a crawl.

“Everyone got burned last year, from being elated over the better economic data only to have their hopes dashed come spring,” said Ellen Zentner, an economist with Nomura Securities International. “If we can get past April and these trends continue, I’ll breathe easy.”

This year, the economy appears to be somewhat less vulnerable to shocks. There were 1.4 million more jobs in January than there were last April, and they were spread across more industries and more cities. Consumers have paid down some of their debt and begun to make large purchases, particularly cars. And so far, gas prices have not risen enough to dampen spending.

February’s growth was in manufacturing, professional sectors like law and accounting, hotels and restaurants, and mining. The construction industry was flat after two months of gains, and the retail sector actually lost jobs.

Some analysts did have reservations about the lack of strong wage growth — average wages grew to $23.31 an hour from $23.28 an hour, but still trailed inflation. And some cautioned that the warm winter could have encouraged a change in consumer habits, essentially robbing the spring of its normal uptick in activity.

Economists also cautioned that growth needed to be much stronger, and for much longer, before the unemployment rate declines significantly. But even among the long-term unemployed, some people were beginning to sense a difference.

Martin Okekearu, 58, an engineer in Kansas City, Mo., with a master’s degree, has had long dry spells in his eight-month search for work. But in the last two weeks, he said, he has received two promising leads from manufacturing firms in the area. One found his résumé on the local employment center’s Web site. It had been posted there for six months.

Mr. Okekearu was relieved that either job would make use of his skills. “My younger son says, ‘Daddy, they talk about somebody educated — you are one of them. They talk about somebody experienced, you are one of them,’ ” he said. “The job market is improving.”

Others said it had become easier to find work, but only temporary or freelance jobs. “My feelings are mixed about the recovery,” said Pam Sexton, 45, also of Kansas City, who was laid off by Sprint in 2009. “So far, I’ve managed to find work, but a full-time, permanent job is somehow elusive to me.”

Mitt Romney, a contender for the Republican presidential nomination, suggested that the jobs gains were not enough to help the 24 million Americans who are still unemployed or underemployed.

“How many months ago was it, 37 months ago, he told us that if he could borrow $787 billion, almost a trillion dollars, he would keep unemployment below 8 percent?” he asked at a campaign stop in Mississippi. “It has not been below 8 percent since. This president has not succeeded, this president has failed and that’s the reason we’re going to get rid of him in 2012.”

Mr. Obama, speaking at a Rolls-Royce plant in Virginia where aircraft engine parts are made, acknowledged that there was a long way to go in bringing unemployment down.

“We’re still recovering from the worst economic crisis in our lifetimes,” he said. “But here’s the good news — over the past two years, our businesses have added nearly four million new jobs.”

Deeper in the labor data, some economists saw hints that job growth may be stronger than the report suggests. For one thing, upward revisions are common during a recovery. Job gains for January and December were stronger than previously reported, the Labor Department said, accounting for 61,000 more jobs than the department estimated last month.

Another good sign, analysts said, was the strength of job growth reported in the department’s household survey. The monthly employment report uses two surveys — one of businesses, from which the net job growth is calculated, and one of households, which generates the unemployment rate. But the household survey also measures job growth, including some types of jobs that the business survey does not capture well.

Household survey respondents indicated that 879,000 more people were working in February than in January. Though it is not unusual for the two surveys to differ, it is unusual for the growth numbers in the household survey to be that much higher.

More people looking for work was also a good sign, said Betsey Stevenson, former chief economist for the Department of Labor and now a visiting professor at Princeton University. She noted that among the unemployed, there were fewer people who had recently lost their jobs and more people who had newly entered or re-entered the workforce, or who had quit their jobs, presumably to look for something better.

“You didn’t want to quit your job a year and a half ago,” she said. “I take that as not just a sign that the labor market is improving, but that workers out there perceive that the labor market is improving.”

John H. Cushman Jr. contributed reporting from Washington.

Advertisements

About internalmarket

This blog and its accompanying Twitter account have been established as social media learning tools for the Internal Communications and Employee Engagement class at Columbia College Chicago. Through this blog, we will share our observations about current events, change management and employee communications theory, and the application of social media in shaping employee engagement.
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s