Some good news from the job front today, as the economy added 235,000 jobs in February. Stock market confidence and unusually warm weather led to 58,000 new construction jobs alone. These numbers are often revised downwards later on, but even so, it's a continuation of the strong job growth we've seen for the past year, and year-over-year wage increases are coming up to 2.8%. So good news all around.
The downside is that the continuing good news makes a Fed rate hike likely this month. Many argue that the economy is still too weak to withstand a rate hike, and I have to say I'd agree with that assessment. We've coming close to something resembling the "Non-Accelerating Inflation Rate of Unemployment," but labor force participation remains well below the rate prior to the Great Recession, and meanwhile, wage gains have stagnated for years on end. So we're due for some inflation before the Fed puts on the brakes. However, Inflation hawks gonna inflation hawk, even if the evidence is against them. A rate hike appears certain. The question is: can economic growth withstand it? We'll find out.
While the job report is good news and the Trump administration can certainly pat itself on the back for not screwing up a good thing, it's worth noting that most job and wage growth occurred in or around our largest cities. That's not Making America Great Again, really; sounds mostly like more good news for the proverbial Liberal Bubble. Emphases added mine:
“Higher-wage jobs might be following educated, young workers, who are increasingly living in dense, urban neighborhoods as other demographic groups move to the suburbs,” said Jed Kolko, chief economist at the job-search site Indeed. “Broader economic shifts also favor big cities: The occupations projected to grow tend to be more urban, while shrinking sectors like manufacturing and farming tend to be located outside large metros.”
That is disappointing for people with longstanding ties to smaller, more rural communities. “A lot of this has to do with mobility,” said Steven W. Rick, chief economist at CUNA Mutual Group, an insurance company. “People are going to have to move where the jobs are and not expect the jobs to come where they are.”
But hey - dictating that job growth occur in select areas and fields sounds a lot like central planning to me, right?
In other good news for the Trump administration, it seems that warmer relations with Russia are paying dividends in terms of Syria operations. The USA, Russia and Turkey all coordinating on strategy is a far cry from the sorry mess of the past few years. The CIA also gave the assorted rebel troops backed the United States an important ultimatum:
Last week, another important move took place when US officers at the CIA-led Military Operation Room in southern Turkey met with moderate Syrian rebels, giving them two weeks to unite or lose any future US military aid.
So who knows? Maybe the lid will get placed back on Syria. Assad will likely still be around; Turkey will have its sphere of influence, Russia will keep its client (Assad), and the United States will have less on its plate in the region, allowing it to shift attention, perhaps to Iran, although with Michael Flynn gone and H.R. McMaster on the rise, maybe war with Iran isn't coming? Too early to say. I do wonder: what happens to the Kurds? An empowered Turkey will have little use for them, and the Trump administration's position on the Kurds is unclear but not promising.
My coverage of the Trump administration has been highly critical to date, and in my defense, lord almighty has there been a lot to criticize. However, the above is good news! We should be happy that job growth (and wage growth) continues apace, even if it means a continuing divide between prosperous urban areas and declining exurban/rural areas, and we should happy should Syria regain some stability after years of fighting, even if it means Assad survives in the end.
I'll get back to the bad, irresponsible news tomorrow.