February 2015 Unemployment Report

February 2015

Unemployment Rate:  5.5 percent

Unemployed Americans:  8.7 million

Employment and Unemployment

• The Department of Labor reported an unemployment rate of 5.5 percent for February, a decrease of 0.2 percent from January. It reported an increase of 295,000 nonfarm jobs over last month. Employment for December remained unchanged at 329,000 jobs created; and January was revised down from 257,000 to 239,000.   

• The number of unemployed people in February was 8.7 million, a decrease from last month’s figure of 9.0 million.

• More than five years after the recession ended, the unemployment rate just this month hit the upper edge of the range (5.2 to 5.5 percent) that Federal Reserve officials consider the long-run average, according to an article in the Wall Street Journal on October 3, 2014.

• The number of long-term unemployed, those unemployed for 27 weeks or more, was 2.7 million, accounting for 31.1 percent of the unemployed. During the 1980s, when our country faced a similar recessionary period, the proportion of long-term unemployed never exceeded 27 percent. 

• The “real” unemployment or U-6 rate is 11.0 percent, down 0.3 percentage point from January. This is the total percentage of unemployed and underemployed workers.

• The “real” number of unemployed Americans is 17.5 million. These are people who are unemployed (8.7 million), want work but have stopped searching for a job (2.2 million), or are working part time because they cannot find full time employment (6.6 million).

• In February, employment grew by 59,000 in food services and drinking places; 51,000 in professional and business services; and 24,000 in health care. Employment in mining fell by 9,000; temporary help services fell by 7,800; and manufacturing of nondurable foods decreased by 3,000. 

Labor Force Participation

• The labor force participation rate is 62.8 percent, down 0.1 percentage point from last month and near the lowest level in 36 years. Since April 2014, the participation rate has been stuck between a narrow range of 62.7 and 62.9 percent. Prior to the recession, the rate stood at 66 percent. 

• If the labor force participation rate were the same as when President Obama took office, the unemployment rate would be 9.7 percent.

• The share of American adults with jobs in February was 59.3 percent, unchanged from last month. This is more than four percentage points below its pre-recession peak. 

• While a stronger labor market is expected to bring back discouraged workers who had given up on their job searches, the Wall Street Journal noted this morning, “so far, there’s little sign that’s happening.”

Wages

• While the economy has added more than 200,000 jobs in each of the last 12 months, hiring has failed to translate into wage growth. Average hourly earnings for all employees on private nonfarm payrolls increased by three cents to $24.78. Over the year, average hourly earnings have risen by only 2.0 percent.

• February was the 66th straight month that year-over-year hourly wage growth has been below 2.5 percent. Prior to the recession, wage growth routinely exceeded three percent.