03.09.2012 News Releases, Policy Points

National Job Market Expands In February

CHAPEL HILL (March 9, 2012) – The national employment situation improved in February, as employers added 227,000 more payroll positions than they eliminated. Furthermore, the unemployment rate held steady at 8.3 percent. While the growth in payroll employment and the maintenance of the unemployment rate are positive developments, the national job market remains far from robust.

“February marked the third straight month in which the national economy gained at least 200,000 more jobs than it lost,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “While 2012 has started well, the extent to which such progress is sustainable is unclear. After all, 2011 started with similar levels of growth, only to see them tail off as the year progressed.”

In February, the nation’s employers added 227,000 more payroll positions than they cut. Gains occurred entirely in the private sector (+233,000), while government payrolls fell by 6,000 positions due mainly to cuts at the federal level (-7,000). Additionally, the payroll employment numbers for December and January underwent upward revisions; with the updates, the economy gained 507,000 jobs over those two months rather than the 446,000 positions previously reported.

Almost every major private-sector industry group netted jobs in February. Professional and business services added the most positions (+82,000 due chiefly to gains in the administrative and waste services sub-sector, which includes temporary help services), followed by education and health services (+71,000), leisure and hospitality services (+44,000 due primarily to growth in the accommodation and food service sub-sector), and manufacturing (+31,000 due entirely to growth in durable goods manufacturing). Meanwhile, the construction industry shed 13,000 positions; the other services sector lost 6,000 jobs; and information shed 1,000 positions.

“Over the past three months, the economy has gained an average of approximately 245,000 jobs,” noted Quinterno. “The current pace of job growth is nevertheless modest relative to the size of the overall jobs gap. The overall economy still faces a shortfall of roughly 10 million jobs—a gap that would take some 5 years to close at the current rate of growth.”

Soft employment conditions were evident in the February household survey. Last month, 12.8 million Americans (8.3 percent of the labor force) were jobless and seeking work. While the number of unemployed Americans and the unemployment rate held steady last month, the share of the population participating in the labor force (63.9 percent) rose slightly, as did the share of the adult population with a job (58.6 percent); regardless, both indicators remain at depressed levels.

Last month, unemployment rates among adult male and female workers were the same (7.7 percent for each group). Unemployment rates were higher among Black (14.1 percent) and Hispanic workers (10.7 percent) than among White ones (7.3 percent). The unemployment rate among teenagers was 23.8 percent. Moreover, 7 percent of all veterans were unemployed in February; the rate among recent veterans (served after September 2001) was 7.6 percent.

Jobs remained difficult to find in February. Last month, the underemployment rate equaled 14.9 percent. Among unemployed workers, 42.6 percent had been jobless for at least six months with the average spell of unemployment lasting for 40 weeks.

“The February employment report offers much proof that the labor market is not rebounding as rapidly as it should following a recession as severe as the recent one,” observed Quinterno. “The February employment report provides little evidence that that joblessness is about to start declining sharply.”

“While the comparatively good growth in payroll employment in recent months is important, the basic fact remains that the economy still is not generating enough jobs for the millions of Americans who need work and has not done so for almost four years.”

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