The labor market continued its winning streak. Here are the five things we learned from U.S. economic data released during the week ending March 10.
Payrolls continued to swell in February. Nonfarm employers added a seasonally adjusted 311,000 workers to their payrolls, up for January’s 239,000 gain. The private sector was responsible for 265,000 of the increase, split by growth in the goods-producing and service sectors of 20,000 and 245,000, respectively. Industries adding the most jobs were leisure/hospitality (+105,000), health care/social assistance (+62,800), retail (+50,100), and professional/business services (+45,000). Average weekly earnings were $1.141.61, up 4.0 percent from a year earlier.
The Bureau of Labor Statistics’ separate household survey puts the unemployment rate at a low 3.6 percent (up 2/10ths of a percentage point from January). 419,000 people entered the labor force during the month, leaving the labor force participation rate at 62.5 percent. The 25-54 labor force participation rate jumped 4/10ths of a percentage point to 83.1 percent, its highest point since January 2020 (itself being the post-Great Recession high). The median length of unemployment plummeted 8/10ths of a point to 8.3 percent (a pandemic low), while the count of part-time workers seeking full-time work held steady at 4.067 million. The broadest measure of labor underutilization (the U-6 series) crept up by 2/10ths of a percentage point to 6.8 percent.
The number of job openings declined in January. There was a seasonally adjusted 10.8 million open jobs, representing a drop of 410,000 from the prior month and 5.8 percent from a year earlier for the Bureau of Labor Statistics‘ measure. The private sector had 9.770 million open positions, including more than a million available jobs in professional/business services and accommodation/food services. Employers hired 6.372 million workers in January, up 121,000 for the month but off 1.9 percent from a year earlier. 5.902 million workers separated from their jobs during the month, virtually unchanged from December and down 5.3 percent from January 2022. 3.884 million people quit their jobs (-207,000 vs. December and -11.5 percent vs. January 2022), while layoffs rose by 241,000 to 1.716 million (+20.4 percent vs. January 2022).
Factory orders slowed in January. New orders for manufactured goods fell 1.6 percent to a seasonally adjusted $542.8 billion. The Census Bureau data series had risen 1.7 percent in December. Durable goods orders slumped 4.5 percent, while nondurables gained 1.5 percent. A sharp drop for aircraft was the main factor in the drop in headline and durable goods orders. Nontransportation orders increased 1.2 percent and civilian nonaircraft capital goods orders advanced 0.8 percent. Shipments ended a two-month losing streak by increasing 0.7 percent to $547.8 billion. Unfilled orders and inventories held steady at $1.157 trillion and $808.3 billion, respectively.
Trade activity and deficit both grew in January. The Census Bureau and the Bureau of Economic Analysis report that exports surged 3.4 percent to a seasonally adjusted $257.5 billion and imports rose 3.0 percent to $325.8 billion. The resulting trade deficit of -$68.3 billion was up 1.6 percent for the month and at its highest since last October. The goods deficit narrowed by $0.6 billion to -$90.1 billion, while the services surplus dropped by $1.7 billion to +21.8 billion. The former resulted from increased exports for pharmaceutical preparations, civilian aircraft, and passenger cars and parts that outpaced rises in imports for consumer goods and automobiles. The U.S. had its largest goods deficits with China, the European Union, Mexico, and Vietnam.
Wholesale inventories shrank slightly in January. The Census Bureau estimates merchant wholesaler inventories declined 0.4 percent to a seasonally adjusted $929.0 billion. Even with the decrease, wholesale inventories were up 15.8 percent from a year earlier. Durable goods inventories narrowed 0.1 percent to $574.1 billion, while nondurables shrank 0.8 percent to $355.0 billion. Wholesale sales jumped 1.0 percent to $693.8 billion (+3.6 percent vs. January 2022), with sales of durables and nondurable growing 0.7 percent and 1.3 percent, respectively. The inventory-to-sales (I/S ratio) of 1.34 was off two basis points from December but 12 basis points above its year-ago reading. The I/S ratios for durables (1.79) and nondurables (0.95) each shed two basis points.
Other U.S. economic data released over the past week:
- Jobless Claims (Week ending March 4, 2023, First-Time Claims, seasonally adjusted): 211,000, +21,000 vs. the previous week, +13,000 vs. the same week a year earlier). 4-week moving average: 197,000 (essentially unchanged vs. the same week a year earlier).
- Consumer Credit (January 2023, Outstanding Non-Real Estate Backed Consumer Credit Balances, seasonally adjusted): $4.796 trillion (+$14.8 billion vs. December 2022; +7.9% vs. January 2022).
- Monthly Treasury Statement (February 2023—1st 5 Months of FY2023, U.S. Government Budget Deficit): -$722.6 billion (+51.9% vs. 1st 5 months of FY2022).
- Beige Book
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What We Learned About the U.S. Economy Last Week 