US Hiring Surges In February As Democrats Move On Stimulus

The US economy saw better-than-expected hiring in February as businesses battered by the Covid-19 pandemic began recruiting employees again, while Congress moved forward with President Joe Biden's massive stimulus proposal despite Republican opposition

Washington, (APP - UrduPoint / Pakistan Point News - 5th Mar, 2021 ) :The US economy saw better-than-expected hiring in February as businesses battered by the Covid-19 pandemic began recruiting employees again, while Congress moved forward with President Joe Biden's massive stimulus proposal despite Republican opposition.

Payrolls jumped by 379,000 last month, which was almost double expectations and pushed the unemployment rate down slightly to 6.2 percent, the Labor Department reported Friday.

The vast majority of the gains were in the leisure and hospitality sector, including the bars and restaurants that were the first to close as business restrictions to stop Covid-19 began nearly a year ago, a sign that the world's largest economy may finally be healing.

Yet the economy was still short 9.5 million jobs compared to February 2020 before the pandemic began, the report said, and White House Chief of Staff Ronald Klain said the data underscore the need for lawmakers to approve Biden's plan for nearly $1.9 trillion in aid.

"If you think today's jobs report is 'good enough,' then know that at this pace (+379,000 jobs/month), it would take until April 2023 to get back to where we were in February 2020," he said on Twitter.

Biden's proposal would be the third major stimulus package to help the United States weather the Covid-19 crisis, and includes a range of measures such as expanded aid for small businesses and the unemployed as well as stimulus checks for Americans.

However, the Republican opposition has argued the proposal is excessive, and it faces a narrow path to enactment in the Senate, where lawmakers will on Friday begin the process of offering amendments to the bill in a debate that could stretch into Saturday.

- Low participation - Unemployment in the United States was at a record low before the pandemic began but spiked to 14.7 percent last April after the restrictions were imposed.

Joblessness has declined in the months since, but at an increasingly slow pace, and economists viewed the December and January data as indicating a stall in the employment recovery.

The sentiment with the February report was much more upbeat, with Gregory Daco of Oxford Economics calling it "an early blossom for employment." But outside the strong hiring among restaurants and bars, other sectors saw smaller gains, with temporary health services adding 53,000 jobs and health care and social assistance adding 46,000.

"The core story here is that the re-opening of services will be the dominant factor in the payroll numbers over the next few months," said Ian Shepherdson of Pantheon Macroeconomics, predicting March could see a payroll increase of one million jobs.

Other industries saw more job losses, including in education, which shed nearly 70,000 positions, and construction, which dropped 61,000.

The labor force participation rate indicating the share of the working-age population actually employed languished at 61.4 percent, the same level as in January and its lowest rate since the mid-1970s.

Meanwhile the unemployment rate for African Americans, who already faced higher joblessness than other groups, ticked up 0.7 percentage points to 9.9 percent, though Asians saw theirs decline one-and-a-half points to 5.1 percent.

The Labor Department's broader measures of joblessness reflect the ongoing issues with workers leaving the labor force altogether, discouraged from looking for work, or who cannot find a full-time position, with 11.1 percent unemployment for the broadest rate known as U-6.

The Labor Department also revised its employment data for the previous two months to show a steeper decline in December payrolls and a larger increase in January for a net gain of 38,000 positions over the two months.

- Lengthy recovery - The report did little to change the dynamic in the Senate, where Democratic leader Chuck Schumer continued to press for passage of Biden's proposal, arguing the economy remained in the doldrums.

"If you just look at a big number, you say, everything is getting a little better," he said Friday. But, "It's not for the lower half of America." Democratic House Speaker Nancy Pelosi also urged action.

"The Feb. jobs report is promising, but millions of Americans still face unemployment & economic crises. Decisive action is imperative," she tweeted.

Republican minority leader Mitch McConnell decried the bill as "a parade of left-wing projects" and said "our country's already set for a roaring recovery."A day earlier, Federal Reserve Chair Jerome Powell -- who has steered clear of partisan politics but repeatedly called for more stimulus spending -- warned that United States is facing a lengthy recovery and will not reach maximum employment this year.

"It's a lot of ground we have to cover," he said.