Hiring surged last month as U.S. employers generated the most new jobs since mid-2016, the Labor Department said Friday, but wage growth slowed as long-awaited gains in worker pay have yet to take permanent hold.
The unemployment rate held steady at 4.1 percent, the lowest since 2000, as the labor force swelled by 806,000. That indicated that more people were coming off the labor-market sidelines to look for work.
The 313,000 net new jobs added in February far exceeded analyst expectations and were a major increase from the previous month’s upwardly revised 239,000 figure. Job growth for December and January was revised up by a total of 54,000 net new positions, meaning the economy has added a robust average of 242,000 jobs the last three months.
The growth was driven by big jumps in hiring in construction, which added 61,000 jobs, and retail, which increased its payrolls by 50,300.
But wage growth slowed in February. Average hourly earnings increased 4 cents to $26.75 after a downwardly revised 7-cent gain the previous month.
For the 12 months that ended Feb. 28, wages increased 2.6 percent. That was down from 2.8 percent for the 12 months that ended Jan. 31.
The January year-over-year wage increase originally was reported as 2.9 percent, an uptick that fueled fears of higher inflation. Those concerns triggered a bout of financial-market turmoil, as investors feared that higher interest rates were coming to keep inflation in check.
Economists had said that January’s wage gains might have been a one-time jump, fueled by increases in the minimum wage that kicked in at the start of the year in several states, as well as raises spurred by the tax cuts enacted at the end of 2017.
The recovery from the Great Recession has been plagued by tepid wage growth of about 2 percent a year. That has been expected to change as the unemployment rate falls and employers have to compete for new workers. But as Feburary’s large increase in the labor force showed, there are still Americans on the sidelines who can be lured back to a growing jobs market and keep wages from rising more quickly.