In February, average hourly wages grew 0.4% and 3.8% from a year earlier, showing pay growth in the employment report.
- Apollo’s chief economist Torsten Slok said that February’s weak jobs report likely reflected temporary factors like weather and strikes.
- A major fiscal package could add 0.9% to U.S. GDP growth, he said, from The Big Beautiful bill.
- Growth was expected to be driven by AI data centers, semiconductors, pharmaceuticals, and defense.
After the U.S. economy lost 92,000 jobs last month and unemployment rose by 4.4%, Apollo Global Management’s chief economist Torsten Slok suggested this likely does not signal a broad slowdown in the economy.
Speaking during a Barron’s Roundtable hosted by Fox News on Sunday, Slok said, “If you look at how markets reacted to the number, it really reveals that the market did not interpret this as bad news as such,” Slok said. Simply translated, the loss of 92,000 jobs in February was not a matter of immediate concern, the economist believes. He added, one of the reasons for the growth would be Donald Trump’s Big Beautiful Bill which he says would add 0.9% to the economy. The bill aims to reduce federal spending amid extending tax cuts implemented in 2017 by President Trump.
According to Slok, several temporary factors may have distorted the employment data, even as other economic indicators continued to point to resilience in the labor market.
The Bureau of Labor Statistics reported that job losses were concentrated in sectors including healthcare, manufacturing, information services, and construction, contributing to the overall decline in payrolls. At the same time, average hourly earnings rose 0.4% in February and were up 3.8% compared with a year earlier, indicating continued wage growth.
Despite the weak employment data, Slok said the Federal Reserve could still face difficulty cutting interest rates in the near term because inflation remained above its target.
“The latest inflation print we have is around 3.0, while the Federal Reserve’s target is 2%,” Slok added.
Semiconductors, Defense And AI Infrastructure To Lead Growth
He also highlighted investment in AI infrastructure and data centers, alongside “industrial renaissance” driven by the reshoring of manufacturing. Sectors such as pharmaceuticals, semiconductors, and defense could benefit, he added. Over the past year, the pharmaceutical industry accounted for a $520 billion economy, while the semiconductor industry saw a whopping 22% surge.
Spending on AI infrastructure and data centers accelerated sharply over the past year as major technology companies expanded capacity, while sectors like pharmaceuticals, semiconductors, and defense are expected to benefit from increased domestic investment and manufacturing activity, he added.
Weak Markets Are Not Worrisome
Separately, ARK Invest CEO Cathie Wood also raised concerns about the reliability of recent employment statistics. Speaking in her latest “In The Know” episode, Wood also said the government’s employment reports are increasingly revised and may not accurately reflect the labor market. “To be honest, the government’s employment statistics are becoming pretty useless,” Wood said.
She noted that the latest nonfarm payroll data showed a drop of 92,000 jobs, even though other employment indicators suggested stronger conditions. “It was supposed to be up 55,000 based on all of the other employment indicators out there, which are all pointing up,” she said.
Wood also pointed out that last year’s payroll data was revised down by 865,000 jobs, significantly changing earlier estimates of job growth.
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