Sat, 01 Apr 2023

US hiring surges by 311,000 jobs despite Fed rate hikes

Robert Besser
14 Mar 2023, 06:22 GMT+10

WASHINGTON D.C.: Adding pressure on the Federal Reserve to raise interest rates to curb inflation, in February 311,000 jobs were added by US employers, which was still fewer than January's increase.

Additionally, the national unemployment rate rose to 3.6 percent, from a 53-year low of 3.4 percent.

Last week's report from the government made clear that the nation's job market remains fundamentally healthy, with many employers still eager to hire.

Meanwhile, Fed Chair Jerome Powell told Congress that if indicators continue to show a robust economy and ongoing high inflation, the US central bank would likely keep increasing rates.

February's increase in jobs showed that further hiring is continuing this year, after easing in late 2022. The average monthly rise in jobs was 284,000 from October through December, surging to 351,000 over the past three months.

However, other data in the report also showed that that the currently hot job market could be better balancing the need among workers and the supply of the unemployed.

The proportion of Americans who are either employed or job hunting for three consecutive months rose to 62.5 percent, the highest level since the start of the COVID-19 pandemic three years ago, when it was 63.3 percent.

After assessing the jobs data and next week's report on consumer inflation for February, the Federal Reserve will makes its decision regarding rate hikes.

The government's January inflation report showed that consumer prices had reaccelerated on a month-to-month basis, raising alarms last month.

"There are clear signs of cooling when you dig deeper into the numbers," said Mike Skordeles, head of economics at Truist, according to the Associated Press.
"Everything now hinges on February's CPI report," said Paul Ashworth, an economist at Capital Economics.

Also last week, President Joe Biden said, "We have created more jobs in two years than any administration has created in the first four years."

However, the strong job market is itself contributing to the high inflation that continues to pressure millions of households, economists warned.

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