Friday, February 01, 2019

January Employment Report: 304,000 Jobs Added, 4.0% Unemployment Rate (Graphs added)

by Bill McBride on 2/01/2019 09:21:00 AM

From the BLS:

Total nonfarm payroll employment increased by 304,000 in January, and the unemployment rate edged up to 4.0 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in several industries, including leisure and hospitality, construction, health care, and transportation and warehousing.
Both the unemployment rate, at 4.0 percent, and the number of unemployed persons, at 6.5 million, edged up in January. The impact of the partial federal government shutdown contributed to the uptick in these measures. Among the unemployed, the number who reported being on temporary layoff increased by 175,000. This figure includes furloughed federal employees who were classified as unemployed on temporary layoff under the definitions used in the household survey.
The change in total nonfarm payroll employment for November was revised up from +176,000 to +196,000, and the change for December was revised down from +312,000 to +222,000. With these revisions, employment gains in November and December combined were 70,000 less than previously reported.
In January, average hourly earnings for all employees on private nonfarm payrolls rose by 3 cents to $27.56, following a 10-cent gain in December. Over the year, average hourly earnings have increased by 85 cents, or 3.2 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 2018. 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 2018 was revised downward by 1,000 (-16,000 on a not seasonally adjusted basis, or less than -0.05 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 304 thousand in January (private payrolls increased 296 thousand).

Payrolls for November and December were revised down 70 thousand combined.

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 2.807 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 increased in January to 63.2%. 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 and long term trends.

The Employment-Population ratio was increased to 60.7% (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 increased in January to 4.0%. 

This was well above the consensus expectations of 158,000 jobs added, however November and December were down by 70,000 combined.  A strong report.

I'll have much more later ...