Unemployment Rate Rises to 6.7% as U.S. Economy Adds 175,000 Jobs

The U.S. Labor Department released February’s job report and announced that 175,000 jobs were created with the unemployment rate rising to 6.7%.

This report was much anticipated as many economists were unsure of what the impact of last month’s severe weather which crippled much of the country would have on the overall economy.

The employment picture picked up from the end of last year’s dismal job numbers as more individuals joined the labor force seeking employment.  The unfortunate aspect is that the report is the long term unemployed, meaning those out of work six months or longer rose from 203,000 to 3.8 million.                                 

“Overall, if the economy managed to generate 175,000 new jobs in a month when the weather was so severe, once the weather returns to seasonal norms payrolls employment growth is likely to accelerate further,” Capital Economics’ senior U.S. economist Paul Dales said in a research note.

Republicans were quick to criticize the president’s handling of the economy, “While it’s good news that more Americans found work last month, there are still far too many asking the question, ‘Where are the jobs?’” Speaker John Boehner (R-Ohio) said in a statement. “They have been waiting more than five years for an answer from this president, and all he has offered is a disastrous health law that’s raising costs, hurting seniors, and making it harder for small businesses to hire.”

Chairman of the Council of Economic Advisers Jason Furman said in a blog post, “Despite a major snowstorm that hit the East Coast during the reference week for the labor market surveys, the rate of job growth picked up from the December and January pace,” and continued to state, “Nevertheless, the unemployment rate remains elevated, and for too many Americans, wages have been slow to rise.”

Today’s employment report will be the last one to be released before the Federal Reserve’s policy-setting panel — the Federal Open Market Committee (FOMC) meets to decide if they will scale back the Federal Reserve’s bond buying program.

The Federal Reserve’s bond buying program was an effort to stimulate the U.S. economy by purchasing treasury and mortgage bonds in its effort to keep long term interests low. The past few months the Federal Reserve has been scaling back its bond buying program from a high of over $80 billion a month to the current $65 billion it buys each month.

This program has been controversial from the beginning as the Federal Reserve has spent well over a trillion dollars a year in its effort to stimulate the economy, but has only made Wall Street wealthier at the expense of Main Street America.  

This report will continue the partisan divide between both parties of who is the better steward of the U.S. economy, especially as the nation heads into the Congressional mid-term elections in the fall.

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