Job creation jumps in February, Obama celebrates

Amid fears that the U.S. could be joining a global slowdown, the economy added a better-than-expected 242,000 jobs in February while the unemployment rate held steady at 4.9 percent. Economists were expecting 190,000 new positions and no change in the jobless figure.

Despite the strong headline number, the closely watched average hourly wages actually declined for the month, falling 3 cents and equating to a 2.2 percent annualized jump, down from 2.5 percent in January. Fed policymakers are looking at wages for evidence of inflation. The average hourly work week also declined 0.2 hours to 34.4.

The bulk of the job gains came from health care, retail and bars and restaurants, which added 57,000, 55,000 and 40,000 new positions, respectively. Construction added 19,000 but mining-related industries lost 19,000 jobs.

Job quality was titled toward part time, which the household survey indicated grew by 489,000, while full-time positions increased by just 65,000.

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A separate unemployment gauge that includes those not actively looking for a job or at work part-time for economic reasons fell to 9.7 percent, the lowest reading since May 2008. A declining labor force participation rate had played a big role in the decline of the headline jobless number, but the gauge rose in February to 62.9 percent, its highest level since January 2015, as the civilian labor force increased by 555,000.

Revision to previous months added 30,000 jobs, with December going from 262,000 to 271,000 and January pushed up to 172,000 from 151,000.

President Barack Obama took a victory lap on the jobs number in Friday remarks to the media.

"Our businesses have created jobs every single month since I signed that 'job killing' Obamacare bill," the president said. "Think about this: If somebody had told us seven years ago that we would get to this point — at a time when we were losing 800,000 jobs a month, and the unemployment rate hit 10 percent — we wouldn't have believed it."

Calling the American economy "the envy of the world," and saying that his administration's economic plans "have worked," Obama framed the jobs growth in terms of some politicians' rhetoric.

"The numbers and the facts don't lie, and I think it's useful given that there seems to be an alternative reality out there from some of the political folks that America is down in the dumps," he said. "It's not: America is pretty darn great right now."

But some pointed to the wage data as a sign that the U.S. economy still has more progress to go.

"The report says that we have a healthy economy and it's beginning to get people back into the market. But it's not pressuring wages yet," said William E. Spriggs, chief economist at the AFL-CIO. "We need everyone to be aware that our wages have not rebounded, so we still have a ways to go before the labor market is really tight."

The figures come amid a turbulent time both for the economy and financial markets. Despite the recent stock rally, the S&P 500 is still down about 2.5 percent for 2016.

Federal Reserve officials are looking for wage-driven inflation as a trigger to continue policy normalization. The U.S. central bank in December enacted a quarter-point hike in its interest rate target, the first such move in more than nine years.

Though members of the Federal Open Market Committee indicated in November that four rate hikes would be likely this year, Wall Street is expecting a much slower pace as economic growth has been disappointing. Traders assign just a 2 percent chance to a March rate hike, with December being the first month that has a more than 50 percent chance, according to the CME.

A mixed bag of data in recent months on top of a global slowdown has intensified fears of a U.S. recession.

"Commentators have been very pessimistic in the past few months, with a lot of talk about a looming recession. Today's jobs report continues the theme that there is no evidence in the data that the U.S. economy is heading into a slowdown," said Andrew Chamberlain, chief economist at job search site Glassdoor. "We seem to be on a slow, steady growth path, to the surprise of many economists."

—CNBC's Everett Rosenfeld contributed to this report.