Hiring boomed in January
The US economy added 304,000 jobs in January, a surprisingly strong month of hiring as employers continue to bring in new workers.
January was the 100th straight month of job gains. The Labor Department said the government shutdown that lasted more than a month had “no discernible impacts” on hiring and wages, but it did contribute to the uptick in unemployment. The unemployment rate rose slightly to 4%.
Another possible ripple effect from the shutdown: The number of people working part time for economic reasons jumped by about 500,000, after many months of declining. The Labor Department said that increase might be attributable to private-sector contractors who lost work during the lapse in funding.
Some of the unexpectedly large jump in hiring appeared to have been pulled forward from December, which was revised down from 312,000 jobs to 222,000. Still, the average for the last three months is now 241,000 jobs — which represents an acceleration in job growth, not a slowdown, as many have been predicting.
Employment gains were led by the leisure and hospitality sector, which has added 410,000 jobs over the past year. That indicates that consumers have been spending freely on recreation, as paychecks have grown and the unemployment rate has sunk.
Retail jobs, however, have stayed essentially flat over the past year as e-commerce — usually represented in the transportation and warehousing category — has taken over an increasing share of employment in the sector.
In January, average hourly earnings rose 3.2%, extending a streak of relatively robust gains as employers have had to pay more to attract workers.
Stock market futures rose on the news. The Federal Reserve said this week that it would hold off on interest rate hikes for at least the next several months, giving Wall Street the best of both worlds: Good economic news, and less fear that it will lead to the Fed tightening the money supply.