January jobs report: US economy adds 353,000 jobs, exceeding Wall Street expectations

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The US job market has started 2024 well.

The US economy created 353,000 non-farm jobs in January According to new data released by the Bureau of Labor Statistics on FridayThat is more than the 185,000 economists had expected.

January’s job gains were also higher than revised December numbers, which showed 333,000 jobs were created last month. Preliminary data released last month showed this to be the case 216.0000 addition to the workforce in the last month of 2023. Combined, the November and December revisions added a total of 126,000 additional jobs compared to the initial reports.

The unemployment rate also stabilized at 3.7% for the third month in a row.

The sudden strength in the labor market has also helped consumers’ wallets.

Wages, a closely watched indicator of inflation and a measure of workers’ influence in the labor market, rose 0.6% month-on-month and 4.5% compared to last year. Economists had expected wages to rise by 0.3% compared to last month and 4.1% compared to last year.

However, some key metrics have declined. The labor force participation rate fell to 62.5%, down from 62.6% the previous month, while average weekly hours worked fell slightly from 34.3 to 34.1.

The largest job increases in Friday’s report were seen in professional and business services, which added 74,000 jobs in February, well above the 2023 monthly average of 14,000 jobs. Meanwhile, health care added 70,000 jobs and retail gained 45,000 jobs.

Federal Reserve Chairman Jerome Powell on Wednesday described the labor market as “at or near normal but not quite back to normal.”

“The labor market is still good in terms of wages and finding a job,” Powell added. “But things are getting back into balance. That’s what we want to see.”

The latest data echoed Powell’s observation about the labor market returning to normal. ADP monthly special payroll Data A report released Wednesday showed the difference between annual wage growth for workers who change jobs and workers who stay in their jobs narrowed to pre-pandemic levels.

“You’re seeing strong wage growth, not excessive wage growth like we’ve seen before,” ADP chief economist Nyla Richardson said on a call with reporters after the release on Wednesday.

The job market has come into focus during the first month of the year Layoff addresses From many companies have accumulated. Broadly, economists I haven’t seen this trend show up in the data yetHowever, I did not expect it to play a prominent role in Friday’s report.

Notably, Chairman Powell reiterated that the Fed does not believe it still needs to see a significant decline in the labor market in order to begin cutting interest rates.

“At this point we want to see strong growth,” Powell said. “We want to see a strong labor market. We’re not looking for a weaker labor market. We’re looking for inflation to continue to decline, as it has been falling over the past six months.”

Construction workers help build a mixed-use apartment complex that will contain more than 700 residential units and 95,000 square feet of commercial space on January 25, 2024 in Los Angeles. (Mario Tama/Getty Images) (Mario Tama via Getty Images)

Josh Schaeffer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.

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