The February Bureau of Labor Statistics report had something for the bulls, and something for the bears.
|Oil industry lay off casualties.|
For the bulls, the economy created a higher than anticipated 242,000 nonfarm jobs; December and January figures were revised upward by 30,000 net jobs, and the labor participation rate increased to 62.9 percent, the highest in a year.
For the bears, wages declined by three cents an hour to $25.35, and the average workweek also declined by 0.2 hours to 34.4. Earning less while logging fewer hours is a bad combination.
Job gains, many of them part-time, came in familiar sectors: health care and education, drinking places and retail. Losses came in manufacturing and mining which includes the energy industry.
While it’s good that underpaid and under-appreciated nurses and teachers are landing on their feet, jobs in health care and education aren’t the stuff of a booming economy, unlike mining and manufacturing.
The oil sector has taken a particularly hard unemployment hit. The explosive job growth that energy workers enjoyed for years came to an abrupt halt in 2015, and is poised to worsen in 2016. As of February, the total active oil and gas rigs in the U.S. fell to 587, edging closer to 500, a number not visited since 1999.
Those lost jobs pay well. When the paychecks stop, the ripple effect kicks in. Real estate, auto and durable goods sales plunge. Cheap crude prices have forced drillers to table plans for $230 billion in new projects which in turn means less hiring.
Stephen Moore, a former Wall Street Journal editorial board member, founder of the open borders Club for Growth and a long-standing immigration advocate, participated in a Fox Business News Channel panel to discuss the February report. Incredulously, Moore said that the data shows that now is “the wrong time to shut down immigration,” and that the U.S. needs more immigration. Moore offered no supporting evidence, probably because no intelligent claim can be made that in such a weak U.S. economy adding more low-skilled, undereducated workers from overseas can in any way behoove Americans.