Unemployment Rate Increases Amid Lower Job Growth in February

The Bureau of Labor Statistics released the February jobs report, indicating a moderate rise in employment but also a slight uptick in the unemployment rate.

In February, the U.S. economy added 151,000 jobs. While this is an improvement from the downwardly adjusted 125,000 jobs recorded in January, it fell short of the anticipated 160,000 jobs, as noted by Trading Economics. Notably, the unemployment rate unexpectedly rose to 4.1%, surpassing the expected rate of 4.0%.

Related Insights:
US Services Sector Shows Unforeseen Growth in February Despite Slower Job Expansion

The number of unemployed individuals rose by 203,000, bringing the total to 7.05 million. Meanwhile, total employment saw a decline of 588,000 workers, resulting in a new total of 163.31 million. The labor force participation rate decreased to 62.4%, and the employment-population ratio fell to 59.9%.

Job growth was notable in several sectors: health care added 52,000 jobs, financial activities saw an increase of 21,000 posts, transportation and warehousing gained 18,000 jobs, and social assistance rose by 11,000. Conversely, federal government employment saw a reduction of 10,000 jobs, potentially due to initial cuts in the Department of Labor's budget.

• Health care employment rose by (+52,000).
• Financial activities increased by (+21,000).
• Transportation and warehousing saw growth of (+18,000).
• Social assistance added (+11,000) jobs.
• Federal government employment declined by (-10,000).
• Average hourly earnings increased by 0.3%, now at $35.93, displaying a 4.0% rise from the previous year.
• The average workweek hours remained steady at 34.1 hours.

Market Implications

The futures market reacted positively following the jobs report release. The SPDR S&P 500 ETF Trust (SPY), which tracks the S&P 500 index, rose by 0.11% to $573.35, while the Invesco QQQ Trust (QQQ), corresponding to the Nasdaq 100 index, climbed by 0.29% to $489.60 in premarket trading.

The iShares 20+ Year Treasury Bond ETF (TLT) also saw gains of 0.5% in premarket trading.

Gold prices, reflected by the SPDR Gold Trust (GLD), surged above $2,920 per ounce, nearing record highs.

Further Reading:

• Pending Home Sales Drop to Historic Lows, Jobless Claims Spike: Wall Street's Response

Note: Image generated using artificial intelligence.

unemployment, jobs, economy