Employers created more jobs in January than economists expected, with 225,000 workers added to payrolls, the Bureau of Labor Statistics reported, while unemployment ticked up to a still-low 3.6%.
Friday’s strong jobs report, which easily exceeded forecasters’ expectations for about 160,000 new jobs, indicates that the economic recovery is still in robust health as it approaches an 11th year, a development that promises to boost President Trump’s chances for reelection.
“The first month of the year saw hiring surge above expectations despite the challenges of what’s broadly viewed as a tight job market,” said Mark Hamrick, senior economic analyst for Bankrate.com.
The unemployment rate rose by one-tenth of a percentage point, for the “right” reason, namely that more people entered the workforce in the month. The labor force participation rate rose from 63.2% to 63.4%, the highest such rate since the spring of 2013.
Meanwhile, wages are growing steadily, the report indicated. Over the past 12 months, average hourly earnings have increased by 3.1%, a rate in line with that of much of the recent recovery. Officials have been disappointed that wage growth has not been stronger as unemployment has fallen to the lowest rates in decades, but the lack of stronger wage pressures also suggests that the jobs recovery may yet have longevity.
Monthly job gains have averaged 211,000 in the past three months, nearly double the pace needed to keep unemployment trending down. That rate is only about 115,000 to 145,000 new jobs a month, according to the Federal Reserve board of governors.
That monthly average reflects upward revisions to the previous two months’ payroll numbers in Friday’s report. For November, the number went from 256,000 to 261,000. For December, job creation was revised from 145,000 to 147,000.
One weak spot in Friday’s report is that manufacturing employment fell, by 12,000 jobs, a decline that likely will be attributed to the effects of Trump’s trade wars. Over the past year, manufacturing jobs have stagnated, even as overall employment has grown by 2 million.
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