US jobs in high gear; wages not so much

The American job market has truly, really, finally, unquestionably shifted into a higher gear.

The 295,000 jobs the nation added in February was comfortably above expectations, drove the unemployment rate down two-tenths of a percentage point to 5.5 percent, and completed the best stretch for job creation in nearly 15 years.

In the past six months, the nation has added just shy of 300,000 jobs a month, the strongest number since the six months ended in March 2000.

This time a year ago, the economy was locked in a long, tepid recovery that involved adding 2 to 2.5 million jobs a year. That has now hit 3.3 million, and will soon hit 3.5 million if this pace of job growth keeps up. This is good news by any standard.

At the same time, however, evidence of some other hoped-for trends is murky to nonexistent.

The absence of meaningful gains in American workers’ pay has been one of the lingering problems in the economy.

With high rates of job growth and an unemployment rate that is down to normal, healthy levels, you would expect workers to have more leverage to demand raises. We’ve seen some evidence that is happening, including the major employers Wal-Mart and Aetna voluntarily increasing their wages for lower-level workers.

But the latest jobs numbers offer no real evidence this is an economywide trend.

Average hourly earnings rose only 0.1 percent in the month, below forecasts. Over the past year, that number has risen only 1.98 percent, actually down a bit from a few months ago. If there is good news, it is that the sharp 0.5 percent gain reported in January was not revised downward, but it’s not a great solace.

A steep drop in oil prices and a rise in the value of the dollar mean that inflation is very low right now, so Americans are seeing inflation-adjusted wage gains despite the paltry wage increases.

But the latest numbers do not appear to forecast a significant rise in wages this year.

Moreover, the unemployment rate fell mostly for not-so-good reasons in February, with the labor force actually shrinking as fewer people were looking for jobs.