February 2023 Jobs Report
Key Takeaways from the February 2023 Jobs Report
- The economy added 311,000 jobs in February, concentrated in Leisure & Hospitality.
- Job growth continues to be robust, frequently surprising economists on a monthly basis.
- A recent national survey of CEOs signals an overall optimism about the economy, despite some mixed economic signals.
- Job growth continues to exert pressure on the Fed to raise interest rates to tamp down on inflation.
- Recent high profile bank failures (such as Silicon Valley Bank) may have an impact on the job market and overall economy, but that impact will probably not be instantly apparent.
Inside the Jobs Report
Topline takeaways from major job sectors:
- Leisure and hospitality increased by 105,000 jobs in February, similar to the average monthly gain of 91,000 over the prior 6 months. Food services and drinking places added 70,000 jobs in February, and employment continued to trend up in accommodation (+14,000).
- Employment in retail trade rose by 50,000 in February, reflecting a gain in general merchandise retailers (+39,000). Retail trade employment is little changed on net over the year.
- Government employment increased by 46,000 in February, about the same as the average monthly gain of 44,000 over the prior 6 months. Employment in local government continued to trend up in February (+37,000).
- Employment in professional and business services continued to trend up in February (+45,000), with a gain of 12,000 in management, scientific, and technical consulting services. Employment in professional and business services had increased by an average of 35,000 per month over the prior 6 months.
- Health care added 44,000 jobs in February, compared with the average monthly increase of 54,000 over the prior 6 months. In February, job growth occurred in hospitals (+19,000) and in nursing and residential care facilities (+14,000).
- Construction employment grew by 24,000 in February, in line with the average monthly growth of 20,000 over the prior 6 months.
Inflation pressures, Interest Rates and Economic Uncertainty
The inflation rate fell to 6% in February which is down substantially from the 9.1% peak in June 2022. Rising inflation has been sparked by a variety of concerns, including supply chain issues, high demand, the war in Ukraine and pandemic-related shutdowns.
Unfortunately inflation remains stubbornly high, and one of the biggest questions we get from our clients nowadays relates to the incredible acceleration of salary expectations against rising economic inflation.
As a counter to inflation, the Fed has increased interest rates. Interest rate hikes are partially being blamed for the economic environment that put pressure on banks like Silicon Valley Bank. Economist expect the push-pull between the Fed and investors to continue into the immediate future.
What CEOs are Saying About the Economy
According to the Business Roundtable CEO Economic Outlook Index, which is a survey of 100+ of the nation’s leading CEOs, CEOs see the economy as fundamentally strong. There was a 6 point uptick in overall optimism, the first sign of growth in the survey since the final quarter of 2021.
Catch Up With Previous Jobs Reports
- January 2023’s unexpected surge
- Steady gains in December 2022
- Growth in November 2022
- Resilience in October 2022
- Mixed messages in September 2022
- August 2022’s cooling forecast
- Great job news in July 2022
- Continued growth in June 2022
- Strong growth in May 2022
- Big month of growth in April 2022
- March 2022’s strong growth
- February 2022’s blockbuster growth
- January 2022’s strong growth despite Omicron
- Promising news for hospitality in December 2021
- November 2021’s mixed picture
- October 2021’s robust gains
- A slower-than-expected report in September 2021
- The summer‘s roaring recovery trajectory in 2021
- Better than expected growth in June 2021, especially in travel
- A turnaround in May 2021
- An anemic April 2021 jobs report
