According to the US Bureau of Labor Statistics, the unemployment rate moved down to 3.8%, which was far ahead of expectations, as the US economy continues to rebound.
The BBC reported that job growth across the US was widespread and led by gains in leisure and hospitality, professional and business services, health care and construction with the number of new jobs added well above analysts’ estimates of around 400,000 new roles.
Companies also added more jobs in January than previously estimated, according to revised numbers released on Friday with average hourly earnings rising by 5.1% over the past 12 months, although that figure is down from a 5.7% annual increase in January.
According to reports, most of the rise in jobs came from the leisure and hospitality industries, which added 179,000 new roles, and at bar and restaurant companies, which filled 124,000 jobs.
Employment in professional and business services rose by 95,000 jobs in February.
However, the total number of jobs on US payrolls is still 2.1 million below where it was before the pandemic.
Analysts predicted that the stronger-than-expected jobs market increased the certainty that the US central bank will raise interest rates at its next meeting which is something US Federal Reserve chairman Jerome Powell was in favor of as quoted saying earlier this week.
Neil Birrell, Chief Investment Officer at Premier Miton Investors made comment “It looks like rates up by 0.25 basis points will be coming this month, as noted by Powell yesterday. The outlook is too uncertain for more than that.”
Seema Shah, Chief Strategist at Principal Global Investors, said an interest rate rise in the US was “all but baked in” to help control soaring inflation rates.