Hiring across the U.S. slowed far more than expected in February, the Labor Department said Friday, further adding to fears of an economic slowdown. Businesses added just 20,000 jobs last month and the unemployment rate declined to 3.8 percent.
- The addition of 20,000 jobs was far below economists’ forecasts for 180,000 new jobs.
- Wages rose by 3.4 percent from a year earlier — a robust gain in earnings for many working Americans
- Investors were spooked by the 20,000 jobs number, sending futures contracts on the Dow Jones Industrial Average down 200 points in pre-market trading
Last year, businesses added an average of 220,000 jobs every month. Economists expect 2019 to show slower but still steady growth in the U.S..
Many major industries showed no significant change in hiring last month, while construction jobs declined by 31,000 jobs, the Bureau of Labor Statistics said. The industries that added jobs included healthcare and professional services, the agency noted.
Slowing global growth, a trade war with China and signs of increased caution among U.S. consumers have led many economists to forecast weaker growth in the first three months of this year.
Still, most analysts expect businesses to keep hiring and growth to rebound in the April-June quarter. It will be harder than usual, though, to get a precise read on the economy because many data reports are still delayed by the partial shutdown of the government, which ended Jan. 25.
In the meantime, there are cautionary signs. Consumer confidence fell sharply in January, held back by the shutdown and by a steep fall in stock prices in December. And Americans spent less over the winter holidays, with consumer spending falling in December by the most in five years.
Home sales fell last year and price gains are slowing after the average rate on a 30-year mortgage reached nearly 5 percent last year. Sales of new homes also cratered late last year before picking up in December. And U.S. businesses have cut their orders for equipment and machinery for the past two months, a sign that they are uncertain about their customer demand.
This is a developing story...