Employment falls in February
San José, CA – On Friday, March 6, the Bureau of Labor Statistics reported that the jobs market took an unexpected fall in February, with a loss of 92,000 jobs.
The job losses were widespread, including manufacturing, construction, transportation and warehousing, information, temporary help, health care, leisure and hospitality, and government all shedding jobs.
In addition, the job creation numbers for December were revised down by 65,000, meaning that instead of gaining 48,000 jobs as previously reported, there was a loss of 17,000. The very good January figures were also revised down by 4000, to 126,000. Taken together, only 7000 jobs were added in December through January, or about 2300 a month.
The unemployment rate also ticked up to 4.4% from 4.3% in January. This is a rise of a whole percentage point from the recent low of 3.4% in April of 2023. In addition, the labor force participation rate dropped from 62.1% to 62%, which tends to lower the unemployment rate, as people with jobs who stop looking are counted as out of the labor force and not unemployed. The increase in joblessness was concentrated among oppressed nationalities as the unemployment rate for Asians, Blacks and Latinos all rose, while the unemployment rate for white Americans stayed the same.
In another sign of economic weakness, U.S. retail sales declined in January by 0.2%, followed by no gain in December. Retail sales figures are not adjusted for inflation, which means that when the changes in prices are taken into account, actual sales fell for the second month in a row (note: these sales figures are seasonally adjusted to take into account the annual bump in sales during the holidays). This decline was led by a 0.9% drop in auto sales, which, as a big-ticket item, often are the first to suffer an economic downturn.
While one month does not decide the direction of the economy (look at the large gain in jobs in January), if large job losses continue, this would be a sign the economy is entering a recession.