Friday, February 02, 2018

January Employment Report: 200,000 Jobs Added, 4.1% Unemployment Rate

by Bill McBride on 2/02/2018 08:46:00 AM

From the BLS:

Total nonfarm payroll employment increased by 200,000 in January, and the unemployment rate was unchanged at 4.1 percent, the U.S. Bureau of Labor Statistics reported today. Employment continued to trend up in construction, food services and drinking places, health care, and manufacturing.
...
The change in total nonfarm payroll employment for November was revised down from +252,000 to +216,000, and the change for December was revised up from +148,000 to +160,000. With these revisions, employment gains in November and December combined were 24,000 less than previously reported.
...
In January, average hourly earnings for all employees on private nonfarm payrolls rose by 9 cents to $26.74, following an 11-cent gain in December. Over the year, average hourly earnings have risen by 75 cents, or 2.9 percent.
...
[Annual Revision] In accordance with annual practice, the establishment survey data released today have been benchmarked to reflect comprehensive counts of payroll jobs for March 2017. These counts are derived principally from the Quarterly Census of Employment and Wages (QCEW), which counts jobs covered by the Unemployment Insurance (UI) tax system. ... The total nonfarm employment level for March 2017 was revised upward by 146,000 (+138,000 on a not seasonally adjusted basis, or +0.1 percent).
emphasis added
Payroll jobs added per monthClick on graph for larger image.

The first graph shows the monthly change in payroll jobs, ex-Census (meaning the impact of the decennial Census temporary hires and layoffs is removed - mostly in 2010 - to show the underlying payroll changes).

Total payrolls increased by 200 thousand in January (private payrolls increased 196 thousand).

Payrolls for November and December were revised down by a combined 24 thousand.

Year-over-year change employmentThis graph shows the year-over-year change in total non-farm employment since 1968.

In January the year-over-year change was 2.114 million jobs.

The third graph shows the employment population ratio and the participation rate.

Employment Pop Ratio, participation and unemployment rates The Labor Force Participation Rate was unchanged in January at 62.7%. This is the percentage of the working age population in the labor force.   A large portion of the recent decline in the participation rate is due to demographics.

The Employment-Population ratio was unchanged at 60.1% (black line).

I'll post the 25 to 54 age group employment-population ratio graph later.

unemployment rateThe fourth graph shows the unemployment rate.

The unemployment rate was unchanged in January at 4.1%. 

This was above the consensus expectations of 176,000 jobs, however the previous two months combined were revised down 24,000.

I'll have much more later ...