The Philadelphia Inquirer
March 7, 2015 – By Jane M. Von Bergen
With the nation’s payrolls expanding by 295,000 jobs in all sectors, the U.S. unemployment rate hit a new postrecession low in February, reaching 5.5 percent, the Labor Department reported Friday.
“We’re getting jobs. There’s definitely a difference,” said John Dodds, director of the Philadelphia Unemployment Project, an advocacy group for low-wage workers.
“Wages are still not up,” Dodds noted.
It is telling that nationwide – at Walmart, in last week’s rallies at City Hall and in Harrisburg, at protests near fast-food restaurants, even in Gov. Wolf’s first budget address – the focus has shifted from gaining jobs to building paychecks.”A recovery where everyone is making poor wages is nothing to brag about,” Dodds said. “People are going back to work, but they are going back to low-paying jobs.”
The last time the unemployment rate reached close to 5.5 percent was in May 2008, when the rate was a slightly lower 5.4 percent.
Back then, the economy was already shedding jobs, but it wasn’t clear how dire the situation would become. Ten months later, in March 2009, the number of payroll jobs dropped by a record 824,000, and by October of that year, the unemployment rate had risen to 10 percent.
Last month, employment rose in manufacturing, despite thousands of jobs shed in petroleum industries. Construction hiring was up, when adjusted for the weather. Jobs were added, too, in retail, financial activities, legal services, engineering, health care, food services, education, and government.
“The one disappointment [is] hourly wages, which rose minimally after jumping in January,” said economist Joel Naroff of Naroff Economic Advisors Inc., in Bucks County.
“The yearly increase has been improving, but it is still too low,” Naroff said.
Citing a similar wage concern in his Friday report, Doug Handler, chief U.S. economist with the Colorado-based economics consultancy IHS Inc., described the news from the Labor Department as “outstanding.
“As with all the recent economic releases, the role of lower energy prices is prominent,” Handler wrote in an e-mail. “Still, with 3.3 million jobs created over the past 12 months, this is the largest yearlong gain since early 2000.”
Jason Hersh, managing partner at Klein Hersh International, said he sees the trend at his company, a Horsham-based search firm specializing in pharmaceutical, life-sciences and physician recruitment.
“February was the best month in our history,” Hersh said, topping January’s billings, which were up 36 percent from a year ago.
In recent years, Hersh said, big pharmaceutical companies have been laying off workers as they trimmed research and manufacturing operations, and contracted with outside companies to handle those functions.
Now, his firm is placing many of the scientists who lost jobs in Big Pharma in these outside companies. Hersh said venture capital has been flowing into life sciences, creating demand for employment.
“The market is active,” he said.
Though people like Hersh are happy with the job market, Wall Street was not pleased by Friday’s report. All three major stock indexes fell at least 1 percent amid fears that the good news would prompt the Federal Reserve to raise interest rates.
Even as job prospects improved for many in February, more than 6.6 million people worked part time who would have preferred to work full time – and that statistic did not include part-time workers who would simply like more hours.
The number of people unemployed for more than six months remained high, at 2.7 million in February, although it is down from 3.8 million a year ago. Three in 10 people are out of work for more than six months, the Labor Department report said.
The unemployment rate is 11 percent for the combined categories of unemployment, including people forced to work part time for economic reasons and people so discouraged about their job prospects that they haven’t looked for work lately.