The U.S. economy added 175,000 jobs in February, a respectable gain that nearly matched the average monthly increase for the past two years. Yet the unemployment rate rose to 6.7 percent from 6.6 percent.
Why did the unemployment rate rise if the job gain was solid?
Because the government conducts one survey to learn how many jobs were created and another to determine the unemployment rate. The two surveys can sometimes produce differing results.
One is called the payroll survey. It asks mostly large companies and government agencies how many people they employed during the month. This survey produces the number of jobs gained or lost. For February, the payroll survey showed that companies and government agencies added 175,000 jobs.
The other is the household survey. Government workers ask whether the adults in a household have a job. Those who don't have a job are asked whether they're looking for one. If they are, they're considered unemployed. If they aren't looking for a job, they're not considered part of the workforce and aren't counted as unemployed. The household survey produces each month's unemployment rate.
In February, the household survey showed that 264,000 more Americans began looking for work. But few immediately found jobs, so they were counted as unemployed. The unemployment rate rose as a result.