Economy

Economists are trying to gauge whether forecasts of a slowing labor market were mistaken or just premature. For now, gains are consistent and strong.If the economy is slowing down, nobody told the labor market.Employers added 275,000 jobs in February, the Labor Department reported Friday, in another month that exceeded expectations even as the unemployment rate rose.It was the third straight month of gains above 200,000, and the 38th consecutive month of growth — fresh evidence that four years after going into pandemic shutdowns, America’s jobs engine still has plenty of steam.“We’ve been expecting a slowdown in the labor market, a more material loosening in conditions, but we’re just not seeing that,” said Rubeela Farooqi, chief economist at High Frequency Economics.Previously reported figures for December and January were revised downward by a total of 167,000, reflecting the higher degree of statistical volatility in the winter months. That does not disrupt a picture of consistent, robust increases.At the same time, the unemployment rate, based on a survey of households rather than businesses, increased to a two-year high of 3.9 percent. The increase from 3.7 percent in January was driven by people losing or leaving jobs as well as those entering the labor force to look for work.A more expansive measure of slack labor market conditions, which includes people working part time who would rather work full time, has been steadily rising and now stands at 7.3 percent.Wage growth slowed slightly in FebruaryYear-over-year percentage change in earnings vs. inflation More

This article is an on-site version of our Disrupted Times newsletter. Sign up here to get the newsletter sent straight to your inbox three times a weekToday’s top storiesThe EU and the US are speeding up attempts to set up a maritime corridor for aid to Gaza from Cyprus, after the US said it would organise a facility off Gaza’s coast to facilitate large ships.The US Food and Drug Administration delayed an approval decision on Eli Lilly’s breakthrough Alzheimer’s disease drug, which was expected to be approved this month. Donanemab will now be subject to a further review by an advisory committee of independent experts.Instagram overtook TikTok in new app downloads last year, boosted by its attempts to copy its rival’s short-form video format. A powerful US congressional committee has passed a bill that would remove TikTok from app stores unless its Chinese owner divests it.For up-to-the-minute news updates, visit our live blogGood evening.And they’re off. US President Joe Biden came out swinging in his final State of the Union address before November’s presidential election at the end of a week in which his would-be nemesis Donald Trump was all-but confirmed as the Republican candidate.As well as frequent jabs at his predecessor and vowing to fight for “democracy and freedom”, Biden took a triumphant tone on the US economy, describing it as the “envy of the world”. His message was reinforced today by another set of better than expected jobs numbers. Some 275,000 posts were added in February, although January’s blockbuster figure of 353,000, which had led investors to dial down expectations of early interest rate cuts, was revised downwards to 229,000. December’s total was also cut by 43,000 to 290,000. The unemployment rate rose from 3.7 per cent to 3.9 per cent.Federal Reserve chair Jay Powell told US senators yesterday that the Fed was “in the right place” in its fight against inflation and was “not far” from having the confidence to start cutting rates. After today’s data and the revisions for previous months, traders are now plumping for that process to begin in June.Aside from selling his record on creating jobs and an unemployment rate still hovering at a 50-year low, Biden used his State of the Union address to reassure still sceptical voters with pledges to tackle “shrinkflation” — in which companies sell new, smaller versions of products without changing the price — and make housing more affordable. He also hit out at business and billionaires who would “finally begin to pay their fair share”. The 1,000 richest Americans will be subject to a minimum tax of 25 per cent, raising $500bn over 10 years, while corporations would pay at least 21 per cent in tax.Biden’s speech came the day after Nikki Haley, Trump’s only surviving rival for the Republican nomination, dropped out of the race after Trump cruised to victory in a string of “Super Tuesday” state primaries, leaving him likely to face off against Biden in a rematch of the last election.Haley’s exit prompted Republican Senate leader Mitch McConnell to endorse Trump, despite having called him a “despicable human being” after the storming of Capitol Hill three years ago. It also makes it easier for Trump to raise money through the Republican National Committee although he still faces 91 criminal charges and a $454mn civil fraud judgment.Biden’s feisty performance, says US national editor Edward Luce, should put to bed any notion that he might yet pull out of the presidential race. But whether he can turn round his poor poll ratings in time — the subject of our latest Big Read — is another matter. “The bad news is if the election were held today, he’d lose,” said one Democratic strategist. “The good news is that it is not being held for 243 days.”Sign-up here for our twice-weekly Election Countdown newsletter for the key plot lines and data points in the run-up to an unmissable election.Need to know: UK and Europe economyThe UK Budget verdicts are in. The Institute for Fiscal Studies and Resolution Foundation think-tanks said pensioners and the wealthy — both traditional Tory supporting groups — were the big losers. FT chief economics commentator Martin Wolf said the chancellor’s giveaways set up fiscal pain for after the election, while the FT editorial board said chancellor Jeremy Hunt was stretching economic reality to make his figures add up. Hunt’s party was left deflated by the lack of buzz. Better news for Hunt came from Bank of England data showing UK wage expectations falling below 5 per cent in February, raising hopes of interest rate cuts. Albeit now in recession, a stronger than expected UK economy and growing hopes of US rate cuts mean sterling is the only major developed world currency to strengthen against the dollar this year.England’s charities watchdog hit out at high street lenders for closing the bank accounts of not-for-profit groups without warning, just as they come under severe pressure from falling local government funding and soaring public demand.The European Central Bank, which held interest rates steady yesterday, signalled a cut in June after lowering its inflation forecast, predicting the 2 per cent target would be hit next year.The surging price of olive oil has turned it into the most shoplifted item in Spain as the “liquid gold” surpasses ibérico ham in the theft rankings. Despite huge investments, increasing competition and environmental benefits, rail travel is still slower and more expensive than flying. A Big Read discusses the future of Europe’s trains.You are seeing a snapshot of an interactive graphic. This is most likely due to being offline or JavaScript being disabled in your browser.Need to know: Global economyEU countries are set to back Kristalina Georgieva for a second term as managing director of the IMF, paving the way for her formal nomination at the Spring Meetings in April in Washington.Rich countries’ borrowing is set to hit a record high $15.8tn this year as they are forced to refinance debt at higher rates, the OECD said, putting a squeeze on many governments’ spending plans. The total overtakes the previous 2020 peak at the height of the coronavirus pandemic.China’s foreign trade grew faster than expected in the first two months of this year, thanks to electronics, higher exports to emerging markets and a “new paradigm” in the country’s relationship with Russia.Need to know: businessThe US is pushing its allies to tighten restrictions on chipmaking exports to China following technological advances by blacklisted Chinese tech companies Huawei and SMIC. The EU is probing Apple’s move to kick Fortnite-maker Epic Games from its App Store, heightening tensions between the bloc’s regulators and the iPhone-maker as new rules regulating Big Tech come into effect. West Coast editor Richard Waters says the Digital Markets Act is a test case for how far regulators can dictate design of products and services.Chinese ecommerce company PDD wants nothing less than to change the way the world shops. Its operations are shrouded in secrecy but its extraordinary growth and the success of its Temu and Pinduoduo apps has made it a big favourite on Wall Street. Our Big Read and new film looks at what’s going on.Video: The rise of Pinduoduo and Temu: profits and secrets | FT FilmScience round-upFebruary was another record month for global temperatures which continued to trend above the critical benchmark of 1.5C higher than pre-industrial levels. Over the past 12 months they have surpassed the 1850 to 1900 average by 1.56C.The UN’s top environmental agency chief warned that a rush into experiments on cooling the atmosphere by partially blocking the sun risked harming wildlife, oceans, the ozone layer and crops after a failure by governments to agree on how to control geoengineering.Organoids — miniature human organs — have been grown for the first time from late-stage foetuses in a breakthrough that could make it easier to monitor and treat congenital conditions before birth.Concerns over “forever chemicals” — perfluoroalkyl and polyfluoroalkyl substances, or PFAS — have snowballed recently. Companies and consumers, who covet miracle products without understanding their true price, need to adjust their thinking, writes Anjana Ahuja.Some good newsSome welcome news to mark International Women’s Day. Nearly $600mn in new funding from governments, donors and multilateral institutions could help stamp out cervical cancer — a disease that kills a woman somewhere in the world every two minutes.Recommended newslettersWorking it — Discover the big ideas shaping today’s workplaces with a weekly newsletter from work & careers editor Isabel Berwick. Sign up hereThe Climate Graphic: Explained — Understanding the most important climate data of the week. Sign up hereThanks for reading Disrupted Times. If this newsletter has been forwarded to you, please sign up here to receive future issues. And please share your feedback with us at [email protected]. Thank you More

Black women saw their unemployment rate fall to 4.4% from 4.8%.
Among Hispanic women, the unemployment rate jumped to 5% from 4.3%.
Valerie Wilson, director at the Economic Policy Institute’s Program on Race, Ethnicity and the Economy, said that the labor market is showing positive signs for Black women.

A sign posted outside a restaurant looking to hire workers in Miami on May 5, 2023.
Joe Raedle | Getty Images News | Getty Images

Unemployment among Black women fell in February as the number of those looking for work increased, data released Friday by the U.S. government showed.
The U.S. unemployment rate edged higher last month to 3.9% from 3.7% in January, according to the U.S. Bureau of Labor Statistics on Friday. Adult women age 20 and older in the labor force followed that trend, with the unemployment rate ticking up to 3.5% from 3.2%.

The percentage of unemployed Black women, however, fell to 4.4% from 4.8%. This comes as the labor force participation rate within the group — which measures how many workers are currently employed or searching for work — rises to 63.4% from 62.9%.

Valerie Wilson, director at the Economic Policy Institute’s Program on Race, Ethnicity and the Economy, said that the labor market is showing positive signs for Black women. She pointed to the decrease in the unemployment rate, while the employment/population ratio edged higher to 60.6% from 59.9%.
“That seems unambiguously that things are moving in a positive direction,” she told CNBC.
As for why the cohort was able to buck the trend, Wilson said it could be due to the specific industries that added jobs last month.
“We saw increases in health care and government services, which are sectors where we see a significant number of Black women being employed,” she said. “The fact that those were two sectors that added jobs and had the highest job growth in the last month is probably a factor in that increased participation rate and reduced unemployment rate.”

For Hispanic women, unemployment rose to 5% from 4.3%.
Overall, with the unemployment rate still sitting below 4%, this month’s report paints the picture of a strong labor market, Wilson said.
“At this point, at that lower rate of unemployment, you’re not going to get huge shifts as long as that growth is still positive on the net,” she said. While economists could still see slight moves from month to month, at the current pace of U.S. job growth, the labor market should remain stable and steady.
— CNBC’s Gabriel Cortes contributed to this report.

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Nonfarm payrolls increased by 275,000 for the month while the jobless rate moved higher to 3.9%. Wall Street had been looking for 198,000 new jobs and unemployment at 3.7%.
Downward revisions to December and January reduced initial estimates by 167,000 jobs.
Wages rose just 0.1% on the month, one-tenth of a percentage point below the estimate, and were up 4.3% from a year ago.
Health care led with 67,000 new jobs. Government again was a big contributor, with 52,000, while restaurants and bars added 42,000.

Job creation topped expectations in February, but the unemployment rate moved higher and employment growth from the previous two months wasn’t nearly as hot as initially reported.
Nonfarm payrolls increased by 275,000 for the month while the jobless rate moved higher to 3.9%, the Labor Department’s Bureau of Labor Statistics reported Friday. Economists surveyed by Dow Jones had been looking for payroll growth of 198,000.

February was a step higher in growth from January, which saw a steep downward revision to 229,000, from the initially reported 353,000. Job growth in December also was revised down to 290,000 from 333,000, bringing the two-month total to 167,000 fewer jobs than initially reported.

The jobless level increased as the household survey, used to calculate the unemployment rate, showed a decline of 184,000 in those employed. The increase came even though the labor force participation rate held steady at 62.5%, though the “prime age” rate increased to 83.5%, up two-tenths of a percentage point. The survey of establishments shows the total number of jobs.
Average hourly earnings, watched closely as an inflation indicator, showed a slightly less than expected increase for the month and a deceleration from a year ago. Wages rose just 0.1% on the month, one-tenth of a percentage point below the estimate, and were up 4.3% from a year ago, down from the 4.5% gain in January and slightly below the 4.4% estimate.
Hours worked rebounded from a slip in January, with the average work week up to 34.3 hours, an increase of 0.1 percentage point.

The jobs numbers likely keep the Federal Reserve on track to cut interest rates later this year, though the timing and extent remain uncertain.

Stocks rose Friday following the news, with the Dow Jones Industrial Average up nearly 150 points in early trading. Treasury yields moved lower; the benchmark 10-year note was last at 4.07%, down about 0.02 percentage points on the session.
“It’s got literally a data point for every view on the spectrum,” Liz Ann Sonders, chief investment strategist at Charles Schwab, said of the report. Those range from “the economy is plunging into a recession to Goldilocks, everything is fine, nothing to see here. It’s certainly mixed,” she added.
Job creation skewed toward part-time positions. Full-time jobs decreased by 187,000 while part-time employment rose by 51,000, according to the household survey. An alternative jobless measure, sometimes called the “real” unemployment rate, that includes discouraged workers and those holding part-time jobs for economic reasons rose slightly to 7.3%.

From a sector standpoint, health care led with 67,000 new jobs. Government again was a big contributor, with 52,000, while restaurants and bars added 42,000 and social assistance increased by 24,000. Other gainers included construction (23,000), transportation and warehousing (20,000) and retail (19,000).
The report comes with markets on edge about the state of growth in the broader economy and the impact that might have on monetary policy. Futures trading moved slightly after the report, with traders now pricing in the greater certainty of an initial Fed interest rate cut in June.
“There’s no new thing under the sun between this report and last month’s report. It doesn’t really give us a whole lot of information, other than we can qualitatively say, we’re still growing jobs at a good pace and wages are still a little bit higher than we would like,” said Dan North, senior economist at Allianz Trade Americas.
North added that the report probably “doesn’t change the narrative” for the Fed, though he thinks the first cut may not happen until July.
In recent days, Fed officials have sent mixed signals, indicating that inflation is cooling but not by enough to warrant the first interest rate cuts since the early days of the Covid pandemic crisis.
Fed Chair Jerome Powell, speaking this week on Capitol Hill, described the labor market as “relatively tight” but moving into better balance from the days when job openings outnumbered available workers by a 2-to-1 margin.

Along with that, he said inflation “has eased notably” though still not showing enough progress back to the Fed’s 2% target. But on Thursday he told the Senate Banking Committee that the state of the economy has the Fed “not far” from when it could start easing up on monetary policy.
“We’ve got a data-dependent fed, which means we’re all at the mercy of the data,” Sonders said. “Big moves outside the range of consensus on labor market data, on inflation data, can move the needle. But in-line or mixed numbers, then we all just jump to the next report.”
Job creation has stayed strong despite a spate of high-profile layoffs, particularly in the tech industry. Most recently, companies such as Cisco, Microsoft and SAP have announced substantial reductions in their workforces. Outplacement firm Challenger, Gray & Christmas said this was the worst February for layoff announcements since 2009, in the late days of the global financial crisis.
However, workers appear to still be able to find employment. Job openings were virtually unchanged in January at nearly 9 million and still outnumbered the unemployed by 1.4 to 1. Weekly jobless claims have moved little, at 217,000 in the most recent week of filings, though continuing claims did just pass 1.9 million, and the four-week moving average for that metric hit its highest level since December 2021.
Amid the conflicting signals, markets have pared back expectations for Fed rate cuts. Futures market traders are pricing in the first reduction coming in June, versus the expectation of March at the beginning of the year, and now figure on four total cuts this year against six or seven previously, according to CME Group data.

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(Reuters) -Federal Reserve Bank of New York President John Williams said Friday that he suspects the “neutral” state of interest rates hasn’t risen much in the wake of the coronavirus pandemic. It’s likely that based on the most recent data “the neutral rate is still quite low,” Williams said in an appearance in London, referring to a level where interest rates neither boost nor slow the economy. Williams did not comment on the monetary policy or economic outlook in his appearance, but he reiterated that achieving price stability is a core responsibility of the central bank. He also said that politics do not factor into the central bank’s decision-making process. In recent comments Williams has said he expects the Fed to lower its interest rate target this year but he has not signaled when he expects that to happen. More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.EU countries are preparing to back Kristalina Georgieva for a second term as managing director of the IMF, paving the way for her formal nomination at the Spring Meetings in April in Washington.Finance ministers of EU27 countries are expected to express support for her on Tuesday at a gathering in Brussels, people familiar with the discussions said. European backing is key to obtain the post, as the head of the IMF has historically been a European, while the World Bank, its sister institution, has historically been headed by an American. Georgieva, a Bulgarian economist, was elected to the post in 2019. Her first term in office is set to expire at the end of September.Georgieva is likely to formally announce her bid for a second term as soon as Friday, the people added. The IMF was not immediately available for comment. France has already indicated it would support Georgieva for a second term. Finance Minister Bruno Le Maire said last week that she was “the right person, for the right job, at the right time,” adding that “when you have someone doing a great job, it’s always better to keep the same person at the same post”.President of the Eurogroup Paschal Donohoe, who had been named as a possible candidate in case Georgieva did not run again, told the Financial Times: “Kristalina has done an excellent job as managing director of the IMF,” adding: “When she makes her intentions clear, I’m sure countries will respond back.” More

March futures on the S&P/TSX index were up 0.1% at 7:04 a.m. ET (12:04 GMT).Materials shares were set to rise for the seventh session, as gold prices hit a fresh record high, while most non-ferrous metals were set for weekly gains, aided by a weaker dollar amid hopes of U.S. interest rate cuts. [GOL/] [MET/L]On the flip side, oil prices traded in the red, after some stability on hopes of interest rate cuts in the U.S. and Europe. [O/R]Market focus would be on the monthly non-farm payrolls numbers (NFP) set for release in the United States at 8:30 a.m. ET, that will provide more details on the strength of the labor market in the country.The report follows Federal Reserve Chair Jerome Powell’s congressional testimony where the policymaker said the U.S. central bank was “not far” from being confident that inflation was declining to the 2% target. The benchmark U.S. S&P 500 closed at a record high in the previous session after Powell’s testimony. [.N]Due alongside is a monthly reading of domestic employment data, that follows the Bank of Canada’s decision on Wednesday to hold interest rates steady. The central bank said that underlying inflation meant it was too early to consider a cut. The Toronto Stock Exchange’s S&P/TSX composite index ended 0.9% higher on Thursday, hitting its highest in nearly two years, boosted by gains in technology and railroad shares. (TO)In corporate news, Panama said on Wednesday it had asked First Quantum Minerals (OTC:FQVLF) to suspend a visitor program launched at the disputed Cobre Panama mine, saying the miner did not consult the government before starting the initiative.COMMODITIES AT 7:04 a.m. ETGold futures: $2,174.6; +0.4% [GOL/]US crude: $78.44; -0.6% [O/R]Brent crude: $82.51; -0.5% [O/R] More

LONDON (Reuters) – Stock benchmarks hit new lifetime highs on Friday, buoyed by the prospect of interest rate cuts in the United States and Europe in coming months, with U.S. jobs numbers the next data milestone ahead of Wall Street’s open.As stocks scaled fresh peaks, bond yields and the dollar fell, while gold hit new highs for the fourth straight session.While central banks on both sides of the Atlantic manage expectations of exactly when they will start lowering borrowing costs, investors pushed up the yen after reports that Japan’s central bank may begin hauling rates from negative territory as soon as this month.The dollar headed for its sharpest weekly drop of the year on the growing likelihood of lower borrowing costs.S&P 500 futures and Nasdaq futures were slightly weaker.Crude oil prices seesawed amid the market’s scrutiny of rate cut timings.The MSCI All-Country stock index was up 0.2%, hitting a new lifetime high of 774.95 points.A year ago, investors were staring down the barrel of a U.S. banking crisis and worries about credit, but since then tech stocks have pushed stock indexes to record highs on the back of an AI boom, said Patrick Spencer, Baird vice chair of equities.”You’ve got some very strong macro conditions, disinflation, the approaching monetary pivot, resilient earnings growth, and AI enthusiasm,” Spencer said.”Countering that you have unappealing technical developments where you’ve got some euphoric sentiment and frothy prices in tech, but I suspect as interest rates come down, the breadth of the market will widen,” Spencer said.In Europe, the STOXX index of 600 companies was slightly firmer after hitting a new lifetime high of 504.39.ECB policymaker Francois Villeroy de Galhau said there would be a rate cut in the spring, which he defined as from April until June 21, the date of the central bank’s meeting that month.German bund yields were on track to record their biggest weekly fall since mid-December on raised bets of an ECB cut in rates. U.S. PAYROLLS BREATHER?The U.S. Labor Department’s closely watched jobs data at 1330 GMT is likely to show that growth in the jobs market slowed in February after two straight months of robust gains.Non-farm payrolls likely increased by 200,000 jobs last month after surging 353,000 in January, according to a Reuters survey of economists.After the payrolls, attention will immediately turn to next Tuesday’s U.S. inflation report.In Asia, expectations mounted that the Bank of Japan could finally exit negative interest rates this month.That lit a fire under the yen, lifting it to a one-month high against the dollar, and pushed domestic bond yields higher as well.The Nikkei closed up 0.23%. (T)Elsewhere in Asia, Chinese blue chips rose 0.4% and the Shanghai Composite Index gained 0.6%. Both indexes were set to end the week with marginal gains. [.SS]Hong Kong’s Hang Seng Index rose 0.7%.Data on Thursday showed China’s export and import growth in the January-February period beat forecasts, though that did little to turn battered sentiment around, as investors were left underwhelmed by the lack of details for strong stimulus from Beijing to shore up the country’s economic recovery at this week’s annual parliament session.Hopes of rate cuts put downward pressure on U.S. government bond yields, with the two-year U.S. Treasury yield easing to 4.4881%. The benchmark 10-year yield was last trading lower at 4.0730%. [US/]The dollar eased to a roughly two-month low against the euro, with the single currency last at $1.093.In commodity markets, Brent gave up earlier gains to ease 0.6% to $82.45 a barrel, while U.S. crude fell 0.7% to $78.35 per barrel. [O/R]Spot gold edged 0.4% higher to $2,168 an ounce. [GOL/] More