US job growth soars in February with 273,000 added

Economists expected the US economy added 175,000 jobs last month

U.S. hiring topped expectations in February, as the labor market added 273,000 jobs, before the wide-spreading coronavirus began to affect the economy.

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Unemployment ticked down slightly to 3.5 percent, returning to a half-century low, the Labor Department said Friday. Average hourly earnings rose by 9 cents over the past year to $28.52

The payroll number surged past the estimate of 175,000 from economists surveyed by Refinitiv, who also saw the unemployment rate holding steady from January's 3.6 percent.

It marks the 113th month of straight gains.

President Trump said people were "shocked" by how good the numbers were and said they were at a level "nobody thought was possible."

"JOBS, JOBS, JOBS!!!" he wrote in a Friday morning tweet.

The report contained more good news for the labor market: Employment gains for the previous two months were both revised higher by a combined total of 85,000. December moved up from 147,000 to 184,000, while January went up from 225,000 to 273,000. That means the average job creation over the past three months is a robust 243,000.

HOW LONG DOES A RECESSION LAST?

Gains took place across the board. Health care and social assistance led the way, with 57,000 positions added last month. Health care accounted for 32,000, boosted by physicians (10,000), home health care services (10,000) and hospitals (8,000). Food services and drinking places also boosted the payroll number by 53,000, following a lull in job growth earlier in 2019.

Construction added 42,000 jobs, following a similar gain in January, and professional and technical services increased by 32,000.

As the U.S. continues the longest economic expansion on record, investors are looking at the Department of Labor’s monthly payroll and unemployment data for signs that the rapid job growth over the past two years is softening and leading way to an overall growth slowdown.

Although consumer confidence remains near historic highs and the labor market is chugging along at a healthy pace, concerns are mounting about how the coronavirus outbreak could affect Chinese, and global, growth.

Companies, by and large, were surveyed about their payroll before the virus began to impact growth.

WHAT TRIGGERS AN ECONOMIC RECESSION?

"It's a little like the saying, 'the car was in fine condition before being involved in a collision,'" said Mark Hamrick, senior economic analyst at Bankrate.com. "The new reality amid tremendous uncertainty is the world has experienced a seismic shift, reflected recently in financial markets in anticipation of potentially damaging economic impacts still to come since the February jobs data was collected."

Economists have warned the virus, which causes a disease called COVID-19, could slow hiring in futures months -- and push the U.S. into a recession if it's not contained quickly. So far, the virus has killed more than 3,300 people, with close to 98,000 cases reported worldwide, mostly in China. There have been a total of 232 confirmed cases of coronavirus in the U.S. and 11 deaths.

In a rare emergency move on Tuesday, the Federal Reserve sharply cut interest rates to offset economic fallout from the wide-spreading coronavirus — and left the door open for another potential decrease later this year.

The U.S. central bank said it lowered its key benchmark federal funds rate by 50 basis points to a range of 1 percent to 1.25 percent. It was the first time since late 2008, shortly after the collapse of Lehman Brothers, that policymakers made an emergency cut between scheduled meetings.

Hamrick said he expects policymakers to further reduce rates at their previously scheduled two-day meeting from March 17-18.

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