Thread: Employers add booming 304,000 jobs in January, marking 100th straight month of employ

Employers add booming 304,000 jobs in January, marking 100th straight month of employment gains

Paul Davidson, USA TODAY Published 8:33 a.m. ET Feb. 1, 2019
Updated 9:12 a.m. ET Feb. 1, 2019

Hiring began 2019 on a strong note as employers added 304,000 jobs in January, marking a 100th straight month of payroll growth and defying the 35-day government shutdown, the U.S. trade war with China and a slowing global economy.

The milestone extended the labor market’s record streak of job gains.

The unemployment rate, which is calculated from a separate survey of households, rose from 3.9% to 4 percent, largely because of the government shutdown, the Labor Department said Friday.

Economists surveyed by Bloomberg estimated 165,000 jobs were added last month.

Mildly disappointing: Employment gains from November and December were revised down by a total 70,000. November's was upgraded from 176,000 to 196,000 but December's blockbuster 312,000 was revised down to 222,000, which was still a strong showing.

A whirlwind of unusual factors likely skewed January’s employment totals, economists said. The shutdown wasn’t expected to affect the jobs total broadly, which derives from a survey of businesses and government agencies, because 420,000 federal employees worked without pay and the 380,000 who were furloughed are receiving paychecks retroactively, Labor said. However, the longest shutdown in U.S. history still may have curtailed government hiring, Goldman Sachs said. And layoffs by the government’s private contractors probably suppressed employment by about 30,000, according to Morgan Stanley.

Warm weather in mid-January, when Labor conducted its employment survey, bolstered job gains in industries such as construction and leisure and hospitality, economists said. But since balmy temperatures also contributed to strong payroll gains in December, Goldman Sachs expected some negative offsetting effects last month that would result in net, weather-related job losses.

Also, industries such as retail, restaurants and warehousing sharply ramped up hiring of temporary seasonal workers the past few months, likely resulting in more layoffs in January, according to Morgan Stanley and Grant Thornton.

Generally, the labor market was surprisingly robust in 2018, adding an average of more than 200,000 jobs a month. But economists expect average monthly job growth to slow to about 165,000 or so this year as the trade fight and sluggish global economy take a bigger toll and the low unemployment rate spawns more worker shortages.

Wage growth dips

Average hourly earnings rose 3 cents to $27.56, nudging down the annual gain from an upwardly revised 3.3 percent to a still healthy 3.2 percent.

Pay increases generally have been picking up as employers compete to attract a smaller supply of workers, and they’re expected to approach 3.5 percent or higher by late 2019. The bigger raises eventually could spur faster inflation, posing a dilemma for the Federal Reserve. The Fed this week said it may be done raising rates for now in light of muted consumer price increases and volatile markets

Leisure and hospitality -- which includes restaurants, bars and hotels – and construction both seemed to benefit from the warm weather. Leisure and hospitality led the job gains with 74,000. Construction added 52,000; health care, 45,000; professional and business services, 30,000; and retail, 21,000.

Manufacturers added 13,000 despite the Trump administration’s trade fight with China.

https://www.usatoday.com/story/money...ns/2738245002/

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