The U.S. Bureau of Labor Statistics estimated Friday that 151,000 seasonally adjusted new full- and part-time jobs were added to the economy in January. That was 158,000 new jobs created in the private sector; government jobs fell by 7,000. A consensus of experts surveyed in advance by Bloomberg said the BLS estimate would be that 188,000 new jobs had been created in January.
The estimate makes January the 70th month in a row for private job growth. The official unemployment rate—the so-called “headline” rate that the BLS labels U3—fell to 4.9 percent. That’s the lowest level since February 2008. Officially, the number of unemployed in January was 7.8 million, down from 7.9 million in December.
The BLS also revised its previous tally of new jobs created in December from 292,000 to 262,000. The November count was revised from 252,000 to 280,000.
The civilian workforce rose by 502,000, after having risen by 466,000 in December. The employment-population ratio climbed to 59.6 percent, and the labor force participation rate rose to 62.7 percent.
Wages for all employees on private nonfarm payrolls rose 12 cents an hour in January to $25.39 after falling 1 cent an hour in December. Private-sector production and nonsupervisory employees saw their paychecks rise 6 cents an hour to $21.33. That rise last month is an indication the tightening job market may finally be putting pressure on employers to pay more. Wage growth in the recovery has, until now, been less than impressive, to say the least. The question, as always when we’re looking at a single report, is whether this is a trend or a fluke.
Each month, in addition to the “headline” unemployment rate (U3), the BLS makes an estimate that includes both unemployment and underemployment that the bureau labels U6. Some economists say this is a better gauge of the actual job situation. This counts people with no job, part-time workers who want a full-time job but can't find one, and a portion of the nation’s "discouraged" workers. U6 was unchanged at 9.9 percent in January.
The BLS points out that the bureau’s "confidence level" each month is currently plus or minus 105,000 jobs. That means the "real" number of new jobs created in January was not 151,000 but rather fell into a range between 46,000 and 256,000.
One measure that the bureau includes in the monthly report evaluates the job situation for Americans aged 25-54. These people are said to be in their "prime working years." That is, a person in this category is the most likely of any age categories either to have a job or be looking for one. The employment-population ratio for the 25-54 cohort reached a high point of 81.9 percent in April 2000. By December 2007, when the Great Recession begin, the ratio had fallen to 79.7 percent. It bottomed out at 74.8 percent in November 2010. Since then, the rate has been slowly rising. It climbed to 77.4 percent in November last year, and took a leap in January to 77.7 percent.
Elise Gould at the Economic Policy Institute points to the chart below and writes:
Austerity at all levels of government has been a damper on economic growth. Public sector employment is still below where it was before the recession began, let alone where it should be considering a growing population over the last eight years. As shown in the chart below, we are still down 375,000 public sector jobs from the past peak, and a total of 1.8 million public sector jobs short if we add in the number of jobs that would have been created to keep up with population growth. We’ve seen this shortfall in public sector job growth across the board from the federal government on down to public school teachers at the local level. As my colleague, David Cooper, aptly pointed out last week, “states that invest in their educational systems and bolster their public sectors tend to be more productive over time and more resilient in the face of economic downturns.” In the past year, state and local spending has ticked up, moving this sector from a terrible drag on growth to a very small positive. This is a good first step, but there’s a lot of room to recover more on the public spending front.
Additional key aspects of the January job report:
Hours & Wages
• Average hourly earnings of private-sector production and nonsupervisory employees rose 6 cents to $21.33 in January.
• Average work week for all employees on non-farm payrolls remained unchanged at rose to 34.6 hours in January.
• Average hourly earnings for all employees on private non-farm payrolls rose 12 cents to $25.39.
• The manufacturing workweek rose 0.1 hour to 40.7 hours.
• The average workweek for production and nonsupervisory employees on private non-farm payrolls rose slightly to 33.8 hours.
Job gains and losses in January for selected categories:
• Professional services: + 9,000
• Transportation & warehousing : - 20,300
• Leisure & hospitality: + 44,000
• Information: + 1,000
• Health care & social assistance: + 44,000
• Retail trade: + 57,700
• Construction: + 18,000
• Manufacturing: + 29,000
• Mining and Logging: - 7,000
Here's what the seasonally adjusted job growth numbers have looked like in January for the previous 10 years.
January 2006: + 278,000
January 2007: + 240,000
January 2008: + 19,000
January 2009: - 791,000
January 2010: + 28,000
January 2011: + 42,000
January 2012: + 338,000
January 2013: + 190,000
January 2014: + 187,000
January 2015: + 221,000