Payrolls Up 175K, Jobless Rate Climbs to 6.7%

The Labor Department reported that nonfarm payrolls rose by 175,000 in February after an upwardly revised gain of 129,000 in January and the jobless rate increased from 6.6 percent to 6.7 percent as more workers entered the labor force but were not able to find jobs.

[Related: Anticipating Friday’s Employment Report]

Including the modest gain of 84,000 in December, recent job creation marked the lowest three-month total since mid-2012 when the unemployment rate was over 8 percent.

The jobless rate rose for the first time since January of last year as the number of unemployed persons rose from 10.24 million to 10.46 million. The labor force increased by 264,000, however, those counted as employed rose by only 42,000 while those currently looking for jobs increased by a much larger 223,000. The labor force participation rates was unchanged at 63.0 percent, not far above the recent multi-decade lows.

Unseasonably cold weather has been blamed for the recent labor market weakness as the average workweek fell to the lowest level in three years and some 601,000 people with jobs stayed at home last month during the survey period due to bad weather.

Payroll gains last month were dominated by professional and business services in general (+79,000) and employment services (e.g., temporary help) in particular (+46,000). The number of professional and technical services jobs also rose sharply (+35,000), paced by a big gain in accounting/bookkeeping positions (+15,000).

Elsewhere, job gains were more modest as the education and health care group bounced back (+33,000) from unusually small January gains and payrolls in the leisure and hospitality sector rose (+25,000) after brisk hiring at restaurants and bars (+21,000). Government employment rose (+13,000), primarily due to more states hiring more teachers (+10,000).

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