In an encouraging sign for the U.S. economy, businesses stepped up their hiring last month as the Omicron variant begins its fade and more Americans ventured out to spend at restaurants, shops, and hotels despite surging inflation.
Employers added a robust 678,000 jobs in February, the largest monthly total since July, the Labor Department reported Friday. The unemployment rate dropped to 3.8%, from 4% in January, extending a sharp decline in joblessness to its lowest level since before the pandemic erupted two years ago.
Federal Reserve Chair Jerome Powell said this week he plans to propose that the Fed raise its benchmark short-term rate by a quarter-point when it meets in about two weeks. Powell has acknowledged that high inflation has proved more persistent and has spread more broadly than he and many economists had expected.
The U.S. added back a surprisingly strong 678,000 new jobs in February, performing much better than experts were expecting in a report that’s likely to encourage the Federal Reserve to pursue more aggressive interest rate hikes. pic.twitter.com/vw5zgttU7x
— Forbes (@Forbes) March 5, 2022
February’s hiring data suggest that two years after COVID-19 sparked a nationwide shutdown and 22 million job losses, the disease is losing its grip on America’s economy. More people are taking jobs or searching for work — a trend that, if it endures, will help ease the labor shortages that have bedeviled employers for the past year.
"The string of jobs numbers has been quite good for some time … the labor market is in a very solid position for the US economy going forward," says @ChicagoFed President Charles Evans. "Today's labor report it's good news. It doesn't really change anything." pic.twitter.com/h7uWC2mdwf
— Squawk Box (@SquawkCNBC) March 4, 2022
In addition, fewer people are now working remotely because of the disease, and the number of Americans who are delaying job hunts for fear of the disease fell sharply from January when Omicron was peaking. A continuing flow of people back to offices could boost employment in urban downtowns.
President Biden talking about the #BidenBoom
• 678,000 new jobs in February
• Unemployment fell to 3.8%
• Since Biden was elected America has created 7.4 Million jobs — "More jobs created in a 13 month period than ever before in our history." pic.twitter.com/baEF0Svhs9
— Brad Beauregard Jr 🇺🇸 (@BradBeauregardJ) March 4, 2022
Other recent economic data also show the economy maintaining strength as new COVID infections have plummeted. Consumer spending has risen, spurred by higher wages and savings. Restaurant traffic has regained pre-pandemic levels, hotel reservations are up and far more Americans are flying than at the height of Omicron.
— still_resisting 🇺🇦 #TeamPelosi #DemCast #Blue22 (@persistentpengn) March 4, 2022
Friday’s hiring figures were collected before Russia’s invasion of Ukraine, which has sent oil prices jumping and has heightened risks and uncertainties for economies in Europe and the rest of the world.