The Bureau of Labor Statistics reported that the economy added 235,000 jobs in February, slightly beating expectations. It is very early days for the new administration, but there may be signs that employers are reacting to its deregulatory agenda.
Sectors such as construction did well in February, but other factors such as good weather may well have contributed to that. Retail, which had performed very well in January for the month after a major holiday, nevertheless showed a sharp decline, somewhat offsetting the construction boom.
One good sign for the economy is that the number of unemployed people exiting the labor force (i.e., no longer looking for work) has returned to pre-recession lows. This suggests that job-seekers are being more optimistic about their prospects.
As Richard Morrison notes, the Chamber of Commerce and other employer groups are equally optimistic about the future. With the once seemingly-endless flow of regulation from federal agencies having ebbed (even the Consumer Financial Protection Bureau announced a delay to a major rule coming into effect today, although the rule still needs to be killed), entrepreneurs have more certainty that they will be allowed to grow their businesses without new rules stopping them.
As the new administration’s work to deregulate the American economy proceeds, its effect will become clearer in the job numbers. We are still some way short of the job numbers needed to get the economy back on track in terms of strong growth, but these job numbers should be welcomed by everyone.