Non-farm Payrolls Rise 242K, Unemployement Steady at 4.9%

The labor market is adding jobs at a very strong rate. Nonfarm payrolls rose 242,000 in February vs the Econoday consensus for 190,000 and a high estimate of only 217,000. Adding to the punch are upward revisions to the two prior months totaling 30,000. A negative in the report is a 0.1 percent decline in average hourly earnings that follows, however, January's outsized 0.5 percent gain. Year-on-year, average hourly earnings are down 3 tenths to 2.2 percent. The unemployment rate remains low at 4.9 percent while the labor participation rate continues to rebound, up 2 tenths in the month to 62.9 percent and boosted by new entrants and re-entrants into the labor market. The U-6 unemployment rate, which is cited frequently by Janet Yellen, is down a full 2 tenths to 9.7 percent. The earnings numbers, along with a dip in the workweek to 34.4 from 34.6 hours, are setbacks but do follow prior strength. Today's report will very likely revive at least the chance for a rate hike at this month's FOMC.

Recent History Of This Indicator:
Nonfarm payrolls are expected to rise 190,000 in February following a lower-than-expected but still respectable 151,000 increase in January. January's employment report, despite the slowing in payrolls, did show strength as the unemployment rate came down and average hourly earnings jumped an outsized 0.5 percent. The unemployment rate is expected to hold at 4.9 percent in February while average hourly earnings are expected to slow to a more sustainable plus 0.2 percent. With jobless claims moving back down, the labor market looks solid and appears to be moving to full employment, and a February report that would no more than meet consensus could very well give the FOMC, outside of secodary considerations, enough justification to hike rates at this month's FOMC.