The U.S. Bureau of Labor Statistics (BLS) reported the U.S. economy created 304,000 jobs in January, nearly doubling the consensus forecast. The consensus called for 158,000, ranging from 140,000 to 183,000.
The unemployment rate edged up to 4.0%, as more public sector workers entered the private sector.
The labor force participation rate, at 63.2%, and the employment-population ratio, at 60.7%, are up by 0.5 percentage point over the year.
Construction employment added 52,000 new jobs in January, including increases in both nonresidential (+19,000) and residential (+15,000). Employment also rose in heavy and civil engineering construction (+10,000) and residential building (+9,000).
Construction has added 338,000 jobs over the past 12 months.
Mining employment rose by 7,000 and the industry has added 64,000 jobs over the year, the continuation of a reversal from a negative trend under the previous administration.
Manufacturing added 13,000 new jobs, with gains in durable goods (+20,000) offsetting losses in employment in nondurable goods (-7,000).
Manufacturing employment has increased by an astonishing 261,000 over the year, with more than four-fifths of the gain in durable goods industries.
The BLS estimated the private sector absorbed 175,000 furloughed federal workers from the partial government shutdown.
As People’s Pundit Daily (PPD) reported Thursday and the Labor Department confirmed in the report, wages and salaries in the fourth-quarter (Q4) 2018 posted the largest gain since Q3 2008.
The 3.1% increase, which was included in the Employment Cost Index that came in at 0.7%, is the first time in more than a decade that wages and salaries broke 3%.
In January, average hourly earnings (wages) for all employees on private nonfarm payrolls increased by 3 cents to $27.56, following a 10-cent gain in December.
Over the year, wages have gained by 85 cents, or 3.2%.
The change in total nonfarm payroll employment for November was revised up from +176,000 to +196,000, while December was revised down from +312,000 to +222,000.
“Strong headline and a tick up in the unemployment rate means the Federal Reserve can stay on hold despite strong economic growth,” TJM Investments analyst Tim Anderson told PPD from the floor of the New York Stock Exchange (NYSE).
“Yes, unemployment was likely impacted by shutdown, but a very strong headline and 4% means expectations for the fed rate hike won’t change and the labor market is very strong,” Mr. Anderson added. “The headline numbers are every bit as strong as the revisions on a smoothed basis, and wages were revised higher.”
On Wednesday, the ADP National Employment Report found U.S. private sector employment rose by 213,000 jobs from December to January, easily beating the forecast.
“The labor market has continued its pattern of strong growth with little sign of a slowdown in sight,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. “We saw significant growth in nearly all industries, with manufacturing adding the most jobs in more than four years.”
Unlike the Employment Situation from the Labor Department, more commonly referred to as the monthly government jobs report, ADP is sourced by actual, anonymous payroll data of client companies served by ADP.
“The job market weathered the government shutdown well. Despite the severe disruptions, businesses continued to add aggressively to their payrolls,” Mark Zandi, chief economist of Moody’s Analytics, said. “As long as businesses hire strongly the economic expansion will continue on.”