Jumat, 06 Maret 2020

Economy defied early coronavirus fears in February with 273,000 new jobs, unemployment ticked down to 3.5% - Washington Examiner

Employment growth in February beat expectations, as 273,000 workers were added to payrolls, the Bureau of Labor Statistics reported on Friday. The unemployment rate was 3.5%, versus 3.6% in January.

Forecasters had expected about 175,000 jobs.

The coronavirus outbreak did not impact hiring in February, according to the Labor Department. The job growth numbers for December and January were also revised up, by a combined 85,000.

Altogether, the labor market displayed great strength heading in March, when fears about the coronavirus began to crimp commerce. Employers had added an average of 243,000 jobs a month in the past three months, about double the number the Federal Reserve has calculated is necessary to keep unemployment trending down.

Yet not all the news from Friday's report was as encouraging. Labor participation was flat. Wages increased by 3% from the previous year, in line with previous months' readings and not as high as might be expected at this stage of the economic expansion.

The low level of unemployment under President Trump has not been seen since Richard Nixon’s first term as president, a development that should bolster his reelection prospects. Yet, U.S. economic performance is threatened by the coronavirus outbreak, which has scrambled supply chains and crimped demand for goods and services.

The survey period for the February jobs report was too early to reflect the growing effects of the spread of the disease to the United States. So far, 19 states have reported over 200 cases of the virus, and there have been 11 deaths in the U.S.

The disease has caused businesses to rearrange plans. Washington state and California have declared states of emergency, and many businesses in afflicted areas, including Amazon and Facebook in the Seattle area, have told employees to work from home or have canceled conferences. Washington Gov. Jay Inslee, a Democrat, asked state residents to seriously consider postponing large events to limit the spread of the virus.

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Airlines could absorb losses totaling $113 billion because of business travel cancellations due to the coronavirus outbreak, the International Air Transport Association, a trade association for the world's airlines, projected Thursday. Flights into the U.S. are projected to drop 6% over the next three months because the coronavirus outbreak continues to roil the global economy, according to research conducted by the U.S. Travel Association, a nonprofit organization that represents the travel industry. The decline is the largest since the 2008 financial crisis.

The virus has wreaked havoc on the stock markets, leading to major volatility in the past weeks.

In an effort to subdue the spread of the virus, Congress on Thursday sent an $8.3 billion spending bill to the White House for Trump’s signature. The bill funds testing kits, a vaccine, and local response efforts to deal with a coronavirus outbreak as well as low-interest loans for small businesses negatively affected by the virus.

Reacting to the possibility that the market reaction to the coronavirus could translate into credit problems, the Federal Reserve on Tuesday issued an emergency reduction in its interest rate target of half a percentage point. The change will "avoid a tightening of financial conditions, which can weigh on activity, and it will help boost household and business confidence," Chairman Jerome Powell said afterward. The Fed is scheduled to meet on March 17 and 18 for a regularly scheduled monetary policy meeting.

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2020-03-06 13:31:00Z
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