Companies hired workers at a slower pace than projected for February 2012, indicating businesses are waiting for pickup in demand before turning to ramping up headcounts. After being revised to 127,000 jobs in January, February’s numbers reflect an increase of 139,000 jobs and contributes to the weakest two-month period since August and September 2012. Bloomberg-surveyed economists generated a median 155,000 expected jobs for the period.
Winter shoppers, discouraged by the harsh, cold weather conditions across much of the country, have stayed away from stores and car dealerships, spurring companies to hesitate to speed up hiring. Faster payroll growth would also boost consumer spending thanks to bigger wage gains.
Goods-producing industries experienced a payroll increase of 19,000, factories added 1,000 jobs, and construction companies increased headcount by 14,000. Services providers added 120,000 jobs in February, led by professional and business services providers. Larger employers (employing at least 500 workers) added 44,000 jobs, medium-sized companies (between 50 and 499 employees) took on an additional 35,000 workers, and small companies grew their payrolls by 59,000.
The effects of the harsh winter weather on the house building industry may slow construction hiring as housing starts dropped by 16 percent in January to an annual rate of 880,000. This, and other economic factors, are expected to improve as the weather warms and customers return to their normal shopping habits.