by - The US added 517k jobs in January and started the year with surprisingly strong job creation.
- January job growth far exceeded forecast of 185k job creation.
- The US unemployment rate was 3.4% in January, below the estimate of 3.6%.
The US started the year with an alarmingly strong job market.
The US added 517,000 jobs in January, according to nonfarm payrolls data from the Bureau of Labor Statistics. That was well above the forecast of 185,000 new jobs forecast by economists polled by Bloomberg.
Additionally, the US unemployment rate was 3.4% in January, below the 3.6% forecast by economists. The unemployment rate of 3.4% marks a more than 50-year low, having last been at this level in May 1969.
“The job market is racing in 2023,” Daniel Zhao, chief economist at Glassdoor, told Insider. “It’s nice to see 2022 after a year that was marked by a surprisingly robust job market. We get an echo of that in the first report from 2023.”
December jobs growth has been revised to 260k from 223k. November job creation was also revised down to 290k in Friday’s report from 256k in the last news release in January. Friday’s press release has been revised due to the annual benchmark process, “updated seasonal adjustment factors” and industry changes.
“Revisions due to both the NAICS 2022 conversion and the benchmark process will affect more historical data than is typical in the annual benchmark process,” according to a press release from the Bureau of Labor Statistics last month.
Overall, the revisions to monthly growth in 2022 meant that 311,000 more jobs were added last year than previously reported.
Both the information and utilities sectors saw modest job losses from December to January. Other industries have created jobs.
“Job growth was widespread, led by gains in leisure and hospitality, professional and business services, and healthcare,” Friday’s press release said.
Employment in leisure and hospitality rose by 128,000 in January, ahead of December’s 64,000 job creation. The industry is still below its February 2020 employment level.
Professional and business services continued to post job growth, adding 82,000 new jobs in January.
In addition, average hourly wages increased by 4.4% in January 2021 compared to the previous year. That means this growth is showing signs of slowing, based on year-over-year changes. Hourly wages, however, rose 0.3% from December to January and are now at $33.03.
In addition to Friday’s job creation data, Bureau of Labor Statistics data released Wednesday also showed how the U.S. job market ended 2022. Job vacancies rose to 11.0 million in the last month of the year, an increase of over 500,000 jobs from November levels.
In the US, the vacancy per jobless ratio rose to 1.9 in December from 1.7 in October and November. 2022 was a series high in the number of terminations with annual results beginning in 2001.
“More than 50 million Americans quit their jobs in 2022, compared to just 40 million in 2018 and 42 million in 2019,” said Julia Pollak, chief economist at ZipRecruiter. “Rather than fizzle out, the Great Resignation continued in full swing throughout the year.”
Fed Chair Jerome Powell hinted at a news conference on Wednesday about how job growth was after the Fed hiked interest rates by 25 basis points.
“Although the pace of job growth has slowed over the past year and nominal wage growth is showing some signs of slowing, the labor market has remained unbalanced,” Powell said.
This is an evolving story. Please check again for updates.
