Employment report
Nonfarm payroll employment grew 192,000 in February, following an upward revision in January to 63,000, from a very weak initial report of 36,000 (adding 27,000). Total private employment increased by 222,000 in February. The unemployment rate fell from 9.0% in January to 8.9% in February, reaching its lowest rate since April 2009. Average weekly hours worked remained unchanged at 34.2 hours and average hourly earnings for all employees posted a small $0.01 gain for the month of February. Despite the positive news that the unemployment rate has declined to below 9.0%, the pace of job creation remains far too weak to draw discouraged workers back into the labor market.

ISM Manufacturing
The Institute for Supply Management's (ISM) manufacturing index increased in February to 61.4, from 60.8 in January. February’s rate was the seventh consecutive increase in as many months, putting the index above the average fourth quarter mark of 57.9. Notably, new orders rose 0.2 points to 68 and the employment index increased 2.8 points to 64.5. The other components of the survey showed continued gains and manufacturers are working through existing inventories. These steady gains could translate into increases in hiring and give the recovery more staying power.

Factory Orders
New orders for manufactured goods rose 3.1% in January adding to December’s gain of 1.4%. Orders for nondefense capital goods excluding aircraft, so called core orders, fell 1.9%% after gaining 2.4% in December. Shipments of nondurable goods increased 3.1% and durable goods were up 0.3% for the month. Inventories rose by 1.3%, down from a 1.4% increase in December. Unfilled orders decreased 0.6%, reversing December’s decline. These data point to continued growth in equipment and software investment in the first quarter of this year.