Average Weekly Hours Worked Fall in February

On Friday, the Labor Department reported the economy gained 175,000 jobs in February, roughly on pace with population growth. In a worrying trend, though, the Department also reported that the average number of hours worked fell for the month. Production and non-supervisory employees averaged just 33.3 hours a week in February. That is down 1.5% since last year.   

Average weekly hours worked are a leading indicator of future job growth. Employers will generally add hours to existing employees before making new hires. Falling hours, however, indicate there is room in the existing labor force to meet current demand. Off all industry sectors, only mining and information saw an increase in average hours worked from last year. Seventeen industry sectors saw average weekly hours fall. Hours worked for all employees similarly fell.

Both retail trade and leisure & hospitality, which together employ almost 30 million Americans, both saw average hours worked fall below 30 hours a week. Last year, retail trade hours were just over 30 hours a week. Last month, weekly hours in the sector average just 29 hours. In leisure & hospitality, average weekly hours worked were under 25 hours. 

In early February, the CBO estimated that the impact of ObamaCare’s health insurance mandate would lead to a decline in average hours worked over the next decade. The agency estimated that average hours worked would fall by 1.5-2% by 2024. That’s already happened this year. The CBO’s estimate of the equivalent of 2 million full-time jobs disappearing may be a best case scenario.