The U.S. economy posted strong job gains overall in February thanks to outsized increases in the business services, construction, health-care and hospitality industries as well as an unusual surge in government hiring.
The Labor Department reported Friday that payrolls increased by 273,000, smashing the 175,000 estimate that economists polled by Dow Jones had expected. The unemployment rate fell to 3.5%, equaling its lowest level in more than a half-century.
CNBC studied the net changes by industry for February jobs based on data from the Labor Department contained in the employment report.
The broad education and health services industry showed the strongest hiring numbers across the month. That gain, however, was almost entirely thanks to a surge in hiring among health-care providers and social assistance firms. Health care has for months reaffirmed its place as an employment juggernaut in the U.S. for the foreseeable future thanks to changing demographics and advances in medical technology.
The health care and social assistance subsector (including child day care and family services) alone saw a net gain of 56,500 jobs. Ambulatory health-care services, hospitals, and nursing and residential care facilities helped account for more than 30,000 net job gains in February.
Peter Boockvar, chief investment officer at Bleakley Advisory Group, noted that mild winter weather also spurred a surge in construction hiring. The industry posted net job gains of 42,000 in February, a notable bump for an industry that often slows in the height of snowy, cold weather.
“The private sector hiring was helped by weather in that construction added 42k jobs after 49k in January vs the average of about 10k each in the prior 3 months,” Boockvar wrote. “Leisure/hospitality, another weather beneficiary, saw hiring jump by 51k, the most in 4 months.”
Leisure and hospitality businesses, such as hotels and eateries, added a whopping 51,000 jobs last month thanks to another strong month of hiring at restaurants, bars and other food services hubs. But some, such as Loyola Marymount University business economist Sung Won Sohn, said he’ll be keeping a close eye on those numbers going forward amid coronavirus fears.
“Consumers have been the backbone of the recent economic strength but we can’t count on them any longer,” he wrote. “Coronavirus will hit almost every industry, especially leisure and hospitality which accounts for 11% of nonfarm jobs.”
The manufacturing sector, a key priority for President Donald Trump, added a modest 15,000 jobs in February. That failed to offset a decline of 20,000 in January.
“Employment in health care and social assistance increased by 57,000 in February. Health care added 32,000 jobs, with gains in offices of physicians (+10,000), home health care services (+10,000), and hospitals (+8,000),” the government said in a press release.
The government also offered comments on a spike in government hiring, which posted a net gain of 45,000 jobs in February thanks to what the Bureau of Labor Statistics said was a surge in “state government education” employees.
Business and professional services, another strong industry for job creation in recent months, added 41,000 jobs. That industry includes professions such as lawyers, consultants and engineers.