U.S. Adds 273,000 Jobs as Economy Braces for COVID-19 Impacts
This morning’s jobs report shows the United States economy adding an incredibly strong number of jobs during the short (but one-day longer than normal) month of February. Moreover the underline unemployment rate fell once again. However it seems difficult for economists to focus on that when several unknowns threaten to impact conditions going forward.
As for the good news: the economy added 273,000 jobs last month. That blows the 165,000 jobs that economists surveyed by MarketWatch had anticipated. It also bests the 225,000 jobs originally announced for January — although the latest report adjusts that figure upwards to match this month’s 273,000. Additionally, as mentioned, the unemployment rate ticked back down one-tenth of a point to tie the 50-year low of 3.5%. Wages also increased, with the average worker now making $28.52 an hour (up 9¢), although annual the gains fell to 3% from 3.1%
Of course it seems there’s little time to celebrate these numbers as the spread of COVID-19 continues, potentially impacting the U.S. economy. Earlier this week the Federal Reserve made the emergency decision to cut interest rates by half a point in a bid to help bolster the economy. Meanwhile Congress passed an $8.3 billion spending bill dubbed the “Coronavirus Preparedness and Response Supplemental Appropriations Act,” which President Trump signed today. As for the stock market, despite two record rally days, it continues to be weighed down by fears of what a larger COVID-19 outbreak could mean.
Offering insights into what to expect ahead, Principal Global Investors chief economist Bob Baur told CNN Business, “If the virus does start to significantly impact the economy, the effect on jobless claims should begin to surface in March, with a greater impact in April.” On the other hand, ZipRecruiter labor economist Julia Pollak sees a potential savior in the upcoming U.S. Census, noting, “Even if private sector hiring takes a hit in the coming months, any slowdown could be offset by a surge in government hiring as 500,000 Census workers are added to payrolls, In other words, the job market had serious momentum heading into the crisis, and will get a well-timed lifeboat in the form of Census hiring.”
Obviously this month’s jobs reports marks an interesting time for the U.S. where uncertainty and fear abound. In most other months, the figures in February’s report would be far more celebrated and would likely signal more prosperous months ahead. Sadly that might not be the case this time around as a slow down seems all but inevitable. With that the big question becomes can the U.S. rebound once the COVID-19 threat is contained?