It is not without caveats, but the latest report from the Bureau of Labor Statistics is good news.
According to the latest data from the Bureau of Labor Statistics, 236,000 jobs were created last month, bringing the unemployment rate down to 7.7 percent. Analysts had expected 160,000 jobs.
The private sector created 246,000 jobs, while the public sector again contracted, losing 10,000 jobs. The wider U-6 measure of underemployment fell a tick to 14.3 percent.
BLS revised the number of jobs created in December up from 196,000 to 219,000, and the change for January was revised down from 157,000 to 119,000.
Meanwhile, it’s possible that GDP growth in 2013 may exceed expectations.
Pacific Investment Management Co.’s Bill Gross, manager of the world’s biggest bond fund, said gross domestic product in the U.S. may expand 3 percent this year, an increase from his firm’s most recent growth estimate of less than 2 percent.
The U.S. is “moving towards a 3 percent real GDP growth rate” this year, and a nominal growth rate of 5 percent, Gross said today in an interview with Tom Keene on “Bloomberg Surveillance”. Pimco said in December that the U.S. would grow between 1.25 percent and 1.75 percent in 2013.
The obvious caveat to all of this is that we still don’t know how long sequestration will remain intact and we don’t know to what extent it will place a strangle hold on the greater economy.
While this is undeniably good news, I can’t help but question whether this continuance of good news will make it increasingly unlikely that congress will reverse sequestration. The economy may be strong enough at this point in time to absorb the hit, but that doesn’t mean it’s acceptable. An unexpected increase in GDP does not make up for unnecessary furloughs or cuts to social programs that feed hungry children or educate them under the Head Start program.