WASHINGTON -- The U.S. economy's job engine revved up again last month, producing a surprisingly strong 242,000 net new positions, while the unemployment rate held steady at an eight-year low of 4.9 percent, the Labor Department said Friday.
Job growth was up sharply from January's upwardly revised figure of 172,000 -- far exceeding analysts' expectations -- and should ease fears the United States was slipping toward another recession.
The Labor Department revised up the totals for December and January by a combined 30,000 net new jobs. That means the economy added a solid average of about 228,000 net new jobs over the last three months. The average is about the same as for all of 2015.
With job growth improving, about 555,000 people jumped back into the labor force. That pushed the labor force participation rate -- the percentage of adults in the workforce -- up to 62.9 percent, the highest level since January 2015.
The figure is still historically low, but now has risen for three straight months.
Despite the upbeat top-line figures, there was a key piece of disappointing data in Friday's report that indicates the job market and economy are still not fully healed.
Wages surprisingly declined in February after a strong gain the previous
month. The decline of 3 cents an hour in average earnings, to $25.35, was the first since June and the largest since 2014.
For the 12 months ended Feb. 29, wages have increased 2.2 percent, which is well above the low inflation rate but off the annual pace recorded in the previous two months.
"While the headline numbers in the report are important, many Americans are most eager for better pay gains," said Mark Hamrick, senior economic analyst at financial information website Bankrate.com. "On that front, the February data represents a setback."
The February jobs report is the last significant batch of economic data before Federal Reserve policymakers meet this month to determine whether to enact another small hike in a key interest rate. The mixed data on job gains and wages in the wake of recent financial market turmoil could lead central bank officials to hold off on a rate increase.
"Continued months of strong job growth should eventually translate into durable accelerations in wage growth, but it hasn't happened yet," said Josh Bivens, research and policy director at the Economic Policy Institute think tank. "Given this, job creation and economic expansion should continue to be encouraged, not tamped down with another interest rate hike from the Federal Reserve at their next meeting."