Economy Loses 63,000 Jobs in February

In yet another sign that the economy may be nearing a recession, U.S. employers cut 63,000 jobs in February, the largest single month drop in nearly five years. Last month’s job loss–the largest since March 2003–wasn’t the only bad news in the report issued this morning by the Department of Labor; the revised job figures for January revealed that 22,000 jobs were lost in that month, down from the originally-reported 17,000. “While it’s not definitively clear, [the report] is another sign that the economy is weakening, and it appears to be weakening more and at a greater rate than we thought,” remarked Ken McCarthy, managing director of New York-area research for real estate services firm Cushman & Wakefield Inc. Experts had predicted a gain of approximately 25,000 jobs in February. Notably, job losses were fairly widespread across different industries, indicating that the economic slowdown was affecting many areas of the economy. While construction, which has been slowing for months, lost another 39,000 jobs in February, manufacturing and retail were also stung, losing 52,000 and 34,000 positions, respectively. Another sector seeing losses was in temporary staffing, which may indicate that firms are girding themselves for leaner times ahead by cutting temporary staff. And while the unemployment rate did dip from 4.9 to 4.8 percent last month, the decrease was the result of 450,000 people no longer being counted as members of the labor force and looking for work. Among the few bright spots in today’s report were in the government and health care sectors, which both saw gains. McCarthy (pictured) noted that the report will likely put pressure on the Federal Reserve to cut interest rates by a larger amount it had planned at its next meeting on March 18–or even before that time. “I think it was a foregone conclusion that they would cut, but now the question is how much,” he said. “This [report] could prompt them to do something more aggressive.”