The American job market isn’t just growing. It’s accelerating.
Employers added 236,000 jobs in February and drove down the unemployment rate to 7.7 percent, its lowest level in more than four years. The gains signal that companies are confident enough in the economy to intensify hiring even in the face of tax increases and government spending cuts.
Last month capped a four-month hiring spree in which employers have added an average of 205,000 jobs a month. The hiring has been fueled by steady improvement in housing, auto sales, manufacturing and corporate profits, along with record-low borrowing rates.
Before the spree, employers added an average of 154,000 jobs from July through October and only 108,000 from April through June.
“The recovery is gathering momentum,” Paul Ashworth, an economist at Capital Economics, said in a note to clients.
The gains could boost consumer spending, adding momentum to the U.S. recovery and helping troubled economies in Europe and Asia.
The U.S. economy is forecast to grow a modest 2 percent this year. Growth likely will be held back by uncertainty about the federal budget, higher Social Security taxes and across-the-board government spending cuts that kicked in March 1. And unemployment remains high nearly four years after the end of the Great Recession. Roughly 12 million people remain out of work.
The unemployment rate declined in February from 7.9 percent in January mostly because more people found work. Another factor was that 130,000 people without jobs stopped looking for work last month. The government doesn’t count them as unemployed.
The last time unemployment was lower was December 2008, when it was 7.3 percent.
The unemployment rate is calculated from a survey of households. The number of jobs gained is derived from a separate survey of employers.
Hiring would be rising even faster if governments weren’t shrinking their work forces, as they have been for nearly four years. Governments cut 10,000 jobs in February.