U.S. economy adds 225,000 jobs in January, jobless rate ticks higher to 3.6%

Nonfarm U.S. employment rose by 225,000 in January, better than the 147,000 in December but below the 269,000 in January 2019. The jobless rate was 3.6%, above the 3.5% in December but below the 4% in January 2019, according to figures posted Friday (Feb. 7) by the U.S. Bureau of Labor Statistics.

Most of the job gains were in the construction, health care, and transportation and warehousing sectors. The U-6 rate, which includes those “marginally attached” to the workforce, was 6.9% in January, better than the 8% in January 2019.

“The first month of the year saw hiring surge above expectations despite the challenges of what’s broadly viewed as a tight job market,” Mark Hamrick, senior economic analyst for Bankrate, told Yahoo! Finance. “Payroll gains might have been juiced to a degree by warm January weather with job growth in both construction and leisure and hospitality, led by bars and restaurants, coming in strong.”

Construction employment rose by 44,000 in January with most of the gains in specialty trade contractors, with increases in residential (+18,000) and nonresidential (+17,000) work. Construction added an average of 12,000 jobs per month in 2019.

Health care added 36,000 jobs in January, with gains in ambulatory health care services (+23,000) and hospitals (+10,000). Health care has added 361,000 jobs over the past 12 months.

Employment in transportation and warehousing increased by 28,000 in January. Job gains were in couriers and messengers (+14,000) and in warehousing and storage (+6,000). Over the year, employment in transportation and warehousing has increased by 106,000.

Employment in leisure and hospitality continued to trend up in January (+36,000). Over the past 6 months, the industry has added 288,000 jobs.

Employment continued on an upward trend in professional and business services in January (+21,000), increasing by 390,000 over the past 12 months.

Manufacturing employment changed little in January (-12,000) and has shown little movement, on net, over the past 12 months. Motor vehicles and parts lost 11,000 jobs over the month.

The BLS also adjusted its 2019 data by noting that employers added 2,108,000 to 2,096,000 jobs – a downward revision of 12,000 jobs. Elise Gould, a senior economist at the Economic Policy Institute, tweeted that the revision of 514,000 jobs in March 2019 “represents a meaningful slowdown from initially released data,” noting that average monthly job growth was now “weaker than 2018’s average growth rate.”

Following are other metrics included in the January report.

• Among the major worker groups, the unemployment rates for adult men (3.3%), adult women (3.2%), teenagers (12.2%), Whites (3.1%), Blacks (6%), Asians (3%), and Hispanics (4.3%) showed little or no change over the month.

• The number of persons employed part time for economic reasons, at 4.2 million, was essentially unchanged in January. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.

• The number of persons marginally attached to the labor force, at 1.3 million, changed little in January. These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months.

• In January, average hourly earnings for all employees on private nonfarm payrolls rose by 7 cents to $28.44. Over the past 12 months, average hourly earnings have increased by 3.1%. Average hourly earnings of private-sector production and nonsupervisory employees were $23.87 in January, little changed over the month.