- The Unemployment Rate for February fell to 4.8% versus estimates of 5.0% and 4.9% in January.
- The Change in Non-farm Payrolls for February was -63K versus estimates of 23K and -22K in January.
- Average Hourly Earnings rose .3% in February versus estimates of a .3% gain and an upwardly revised .3% increase in January.
BOTTOM LINE: Non-farm payrolls fell and the unemployment rate unexpectedly dropped in February, Bloomberg reported. Service industries, which include banks, insurance companies, restaurants and retailers, actually added 26,000 jobs last month. Payrolls at builders fell 39,000, the eighth consecutive month of cutbacks. Average Hourly Earnings were up a very healthy 3.7% in February from year-ago levels versus the 20-year average of a 3.3% increase. The Unemployment Rate fell to 4.8% versus the 20-year average of 5.4%. During the economic slowdown in 1995, the economy saw some job losses. However, while GDP growth did slow meaningfully during that period to .7%, the economy avoided recession, notwithstanding the temporary weakening in the job market. Moreover, Americans’ Average Hourly Earnings gains slowed to 2.5% year-over-year during that period versus the current rate of growth of 3.7%. Finally, the Unemployment Rate reached 5.5% in mid-1995 versus the current rate of 4.8%. There was scant talk of recession back then, however in the current “US negativity bubble” it is just assumed by the vast majority of investors and pundits that we are already in one and that it will get much worse, notwithstanding the massive economic stimuli that is on the horizon.
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