WASHINGTON (Reuters) - U.S. employers added a stronger-than-forecast 243,000 jobs in February but the unemployment rate edged up, the Labor Department said on Friday in a report that left analysts divided about whether inflation was heating up.þþAverage hourly earnings grew 0.3 percent during February, in line with expectations, but in the 12 months through February pay rose by 3.5 percent, which department officials said was the highest annual increase since September 2001.þþThe February job gain followed a revised 170,000 new jobs in January that was originally reported as 193,000. Employers have increased their payrolls every month for the past 2-1/2 years, a sign that economic growth is vigorous enough to keep policy-makers on edge about the possibility of inflationary wage and price rises.þþBond prices and stock futures initially dipped but later reversed direction on the jobs report. The latest signs of U.S. economic strength buoyed the dollar's value against other major currencies.þþEconomist Richard DeKaser of National City Corp. in Cleveland said the report shows the labor market ``continues to grow but not at an explosive pace'' and said that might temper Federal Reserve concerns about wage pressures.þþ``We do see a bump-up in hourly earnings,'' DeKaser said. ``We have established a clear two-year upward trend. The workweek actually dipped a little bit, which offset the rise in earnings.''þþThe average workweek in February was 33.7 hours, down from 33.8 hours in January.þþSome analysts described the wage data as troubling.þþ``The only issue is the wage number which does suggest there will be some upside bias on inflation, and it will keep the Fed raising rates,'' said economist John Silvia at Wachovia Corp. in Charlotte, N.C. ``The probability for a hike in May will increase.''þþThe Federal Reserve has pushed U.S. interest rates up 14 times in quarter percentage point increments since mid-2004, bringing the U.S. central bank's bellwether federal funds rate to 4.5 percent. Many analysts foresee the rate rising to 5 percent by July, noting that policy-makers have commented upon the economy's momentum and the need to keep inflation in check.þþThe report showed that another 41,000 construction jobs were added in February, on top of 55,000 in January. Some economists had expected hiring for construction to ease more sharply last month with a return to colder weather after an exceptionally mild January. Manufacturing employment, by contrast, declined 1,000 in February after growing 7,000 in January.þþ
Source: NY Times
