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US payrolls surge in February


US payrolls surge in February


US employers hired more workers in February and the jobless rate fell to a near two year low.

The number of people in work increased by 192,000 – the strongest indication yet the recovery has become self-sustaining.

The unemployment rate dipped to 8.9 percent of the workforce, the lowest since April 2009, another sign that the fragile US labour market is recovering more quickly from the worst recession since the Great Depression.

In January it was nine percent, in December 9.4 percent and in November 9.8 percent.

The December and January numbers were revised to show 58,000 more jobs created than previously estimated. The last time payrolls grew so much was last May, when the government’s hiring of temporary workers for a census boosted payrolls hugely.

The US central bank, the Federal Reserve, is closely watching the jobs market as a major factor in determining when it might raise interest rates.

Economists believe the Fed will want to see payroll gains in excess of 200,000 every month for at least six to nine months as well as a significant decline in unemployment towards its natural five to six percent level before it would start to withdraw its economic stimulus.

The jobs data failed to impress Wall Street as a lot of the employment increase was already priced into markets.

Investors focused on the fact that wage growth in the US was weaker than economists had predicted and pointed out that February’s numbers were exaggerated by the hit to January figures from bad weather.

White House economist Austan Goolsbee said the jobs report showed President Barack Obama’s policies were working to improve the economy, but he said more needed to be done to create jobs.

“We will continue to work with Congress to find ways to reduce spending, but not at the expense of derailing progress in the job market,” Goolsbee said.

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