Jobs Report Shows Improvement in Labor Market as Economy Created 243K New Jobs

The Labor Department reported that Nonfarm Payrolls, which is one of the most closely followed gauges regarding the state of the economy at the present time, showed the jobs market to be improving as the economy created a total of 243,000 new jobs in the month of January.

The increase in the number of new jobs was well above the consensus estimates for an increase of 125,000 and was above December’s revised total of 200,000 (November: 120K). It was also the best rate of jobs growth seen in nine months.

The payrolls report also contained revisions to November and December numbers. The report said the totals for new jobs created in the previous two months were increased by 60,000.

The nation’s Unemployment Rate was once again a big surprise as the rate fell to 8.3%. Expectations had been for an unchanged reading at 8.5%. CNBC reports that the unemployment rate has fallen by 0.8% since August.

Reuters reports the decline in the unemployment rate last month reflected large gains in employment in the private sector (the household survey) and shows that fewer people left the labor force.

Next up, average hourly earnings rose by +0.2% on a month-over-month, which was in line with expectations and another sign that the environment is improving in the job market.

Finally, the average number of weekly hours worked per employee increased by 0.1 to 34.5 from 34.4 in December (November: 34.3).

Job gains appear to have been concentrated in the service sector, particularly in retail and the food and beverage industries. Warehousing, manufacturing, mining and health care also have added to the gains.

Stock futures have improved on the report and are now pointing to a stronger open on Wall Street.

However, a good jobs report has not been a good omen for the stock market of late. CNBC reports that if the market closes lower on Friday it will mark the ninth consecutive time the averages fell on the day of the monthly employment report.

 

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