The Best Since Last Summer: February 28 – March 4

Jobs and the number of available workers rose in February. Here are the five things we learned from U.S. economic data released during the week ending March 4. 


The job market rallied in February. Nonfarm payrolls expanded by a seasonally adjusted 678,000 jobs during the month. And even though this was the best month for the Bureau of Labor Statistics measure since last July, payrolls remained 2.105 million below their February 2020 pre-pandemic peak. The private sector was responsible for 654,000 new jobs, split between 549,000 from the service sector and 105,000 from the goods-producing side of the economy. Industries adding the most workers in February were leisure/hospitality (+179,000), professional/business services (+95,000), health care/social assistance (+94,200), construction (+60,000), transportation/warehousing (+47,600), retail (+36,900), and manufacturing (+36,000). Average weekly earnings of $1,095.83 was 5.4 percent ahead of their year-ago mark. 

The separate household survey has the unemployment rate dropping to a pandemic low of 3.8 percent. 304,000 people entered the labor force in February, with the labor force participation rate up 1/10th of a percentage point to 62.3 percent. The 25-to-54 participation rate grew by 2/10ths of a point to 82.2 percent. The typical length of unemployment dropped by a half week to 9.6 weeks, while the count of part-time workers desiring full-time work grew by 418,000 to 4.135 million. Also inching up is the broadest measure of labor underutilization (the U-6 series), adding 1/10th of a point to 7.2 percent. 

Factory orders rose in January. The Census Bureau estimates new orders for manufactured goods increased for the 20th time in 21 months with a 1.4 percent bounce to $544.2 billion (seasonally adjusted). Factory orders were 15.1 percent ahead of their year-ago pace. Durable goods orders surged 1.6 percent, while those for nondurables gained 1.2 percent. Civilian nonaircraft capital goods—a proxy for business investment—increased 1.0 percent in January and was up 10.4 percent from a year earlier. Shipments gained 1.2 percent in January to $536.9 billion (+11.6 percent versus January 2021). Durable and durable goods shipments rose 1.1 percent and 1.2 percent, respectively. Unfilled orders swelled 0.9 percent to $1.284 trillion, while inventories expanded 0.7 percent to $779.6.

Purchasing managers report that manufacturing activity sped up in February. The Manufacturing ISM, from the Institute for Supply Management, added a point to a reading of 58.6. The Manufacturing ISM has been above a reading of 50.0—the threshold between an expanding and contracting manufacturing sector—for 21 straight months. Improving were index components for new orders, production, and inventories, although the employment measure lost ground during the month. Sixteen of 18 manufacturing industries expanded in February, led by apparel, textiles, and paper products. The press release noted that the field “remained strongly optimistic” despite the challenges their companies may be facing. 

Meanwhile, service sector growth decelerated a bit in February. The Institute for Supply Management’s Services PMI lost 3.4 points to a reading of 56.5. Even though this was the measure’s lowest reading in a year, it also was the 21stconsecutive monthly reading above 50.0 (indicative of an expanding service sector). Falling were measures for business activity, new orders, and employment. The inventories measure, however, improved in February. Fourteen of 18 service sector industries reported growth during the month, led by construction, transportation/warehousing, and educational services. Survey respondents reported that they face “supply chain disruptions, capacity constraints, inflation, logistical challenges and labor shortages.”

Construction spending jumped in January. The Census Bureau reports the value of construction put in place that month jumped 1.3 percent to a seasonally adjusted annualized rate (SAAR) of $1.677 trillion. Spending was 8.2 percent above year-ago levels. Private construction spending gained 1.5 percent to a SAAR of $1.327 trillion (+11.0 percent versus January 2021), with residential and nonresidential construction growing +1.3 percent and +1.8 percent, respectively. Boosting the latter was higher expenditures for manufacturing, power, and transportation. Public sector construction spending advanced 0.6 percent to an annualized $350.7 billion (-1.3 percent versus January 2021). 

Other U.S. economic data released over the past week:

  • Jobless Claims (Week ending February 26, 2022, First-Time Claims, seasonally adjusted): 215,000, -18,000 vs. the previous week, -546,000 vs. the same week a year earlier). 4-week moving average: 230,500 (-71.3% vs. the same week a year earlier). 
  • Vehicle Sales (February 2022, Autos and Light Trucks, seasonally adjusted annualized rate): 14.070 million (-6.4% vs. January 2022; -16.4% vs. February 2021).
  • Productivity (2021Q4-revised, Nonfarm Business Labor Productivity, seasonally adjusted annualized rate): +6.6% vs. 2021Q3; +1.9% vs. 2020Q4.
  • Agricultural Prices (January 2022, Prices Received by Farmers, not seasonally adjusted): -0.9% vs. December 2021; +24.3% vs. January 2021.
  • Beige Book

The opinions expressed here are not necessarily those of Kevin’s current employer. No endorsements are implied.

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