Employers added more workers in February than projected but wages unexpectedly declined, dashing hopes that reduced slack in the labor market was starting to benefit all Americans.
The 242,000 gain followed a 172,000 rise in January that was larger than previously estimated, a Labor Department report showed Friday. The jobless rate held at 4.9 percent as people entered the labor force and found work. Average hourly earnings dropped, the first monthly decline in more than a year, and workers put in fewer hours.
A job market in good health will reinforce job security and encourage Americans to spend, buffering the U.S. from the ill-effects of global economic weakness. At the same time, stronger wage growth, which will play a role in deciding the race for the White House, would help move inflation closer to the Federal Reserve’s goal.
“It indicates the resilience of the economy,” said Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York. “The labor market doesn’t appear to be hurt by financial market volatility. Wages were a bit disappointing.”