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- The US labor market entered 2020 on a stronger-than-expected note, adding jobs for a record 112th month.
- The Bureau of Labor Statistics said Friday 225,000 nonfarm payrolls were created in January, compared with economist forecasts for 165,000.
- Average hourly earnings picked up to 3.1% from a year earlier, compared with 2.9% in December.
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The US labor market entered 2020 on a stronger-than-expected note, adding jobs for a record 112th month.
The Bureau of Labor Statistics said Friday 225,000 nonfarm payrolls were created in January, compared with economist forecasts for 164,000. The unemployment rate edged higher to 3.6%, still hovering near its lowest level in half a century.
Average hourly earnings picked up to 3.1% from a year earlier, compared with 2.9% in December. While wage growth has continued to outpace inflation, it has held below the pace economists would hope for with historically strong employment levels.
The BLS also made major revisions to data for 2018 and 2019, offering a more accurate picture of the labor market. A preliminary estimate of those revisions in August showed two million jobs were added in the year through March 2019, a half a million fewer jobs than previously thought.
“The job market is strong, but not nearly as strong as thought,” said Mark Zandi, the chief economist at Moody’s Analytics. “This revision is well-anticipated so likely won’t impact financial markets, but it may change perceptions regarding the strength of the labor market.”
Still, the revisions were relatively small for an economy with over 150 million total jobs. To keep up with the pace of population growth, the US needs to add roughly 100,000 payrolls per month.
Low unemployment and faster wage gains were able to pull Americans from the sidelines at the fastest pace of the recovery last month. The labor-force participation rate rose to 63.4% in January, though that figure is still low compared with those of global peers.
“It’s clear that plentiful work opportunities are enticing more people to enter, or in some cases re-enter, the labor market,” said Jason Pride, the chief investment officer of private wealth at Glenmede.
This story is developing. Please check back for updates.
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