WASHINGTON—The latest jobs report – with 313,000 jobs gained in February – is still likely to keep the Federal Reserve on track to raise interest rates later this month, said NAFCU Chief Economist and Vice President of Research Curt Long.
The unemployment rate remained at 4.1% in February as 806,000 workers joined the labor force. This matches the lowest unemployment level since 2000, Long noted.
"The February jobs report will be well received in many corners. Job growth surprised to the upside, while wage growth fell below expectations," said Long. "The latter should help allay concerns that a surge in inflation is imminent, but it still keeps the Fed on track to raise rates later this month."
The Federal Open Market Committee (FOMC) left the federal funds target rate at 1.25 to 1.5% during its meeting in January; the last rate increase was in December. The FOMC’s next two-day monetary policy meeting is set for March 20-21.
In other report data, private-sector payroll employment increased 287,000 jobs during February. The goods-producing sector increased 100,000 jobs, while the service sector increased 187,000 jobs. Public sector employment rose 26,000 from the prior month, Long noted.
Average hourly earnings increased four cents to $26.75 in February. Over the last 12 months, wages are up 2.6%. Since 2009, year-over-year wage growth has averaged just 2.2% Long said.