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The non-farm payrolls report showed a better-than-expected number for February.  Hiring was widespread across industries and the unemployment rate ticked down for the right reasons, explains analysts at Wells Fargo. They consider that Although there is still a long way to go in terms of a full recovery, things appear to be once-again moving in the right direction.

Key Quotes:  

“Today’s employment report confirmed what recent spending and production data had already told us: the worst of the winter slowdown is behind us, and the recovery is gaining pace. Job growth in February nicely beat expectations, increasing by 379K, with last month’s disappointing gain revised up by 117K.”

“Despite the encouraging gains in today’s report, we are still very much in the recovery phase of the cycle. Payrolls are 9.5 million lower over the past year, or down 6.2% which is on par with the low point of the Great Recession. While GDP looks poised to regain its pre-COVID peak in the second half of this year, we estimate that the number of jobs in the economy won’t recover until 2023.”

“We expect that as COVID is brought under control and the economy more fully re-opens this summer, participation among women (and men) will rebound strongly, but some individuals won’t easily find their way back to the labor force, which will keep the Fed biased toward staying accommodative for longer even as inflation risks mount.”