The U.S. economy gained 304,000 jobs in January, and the unemployment rate rose to 4%, according to figures released this morning by the U.S. Bureau of Labor Statistics. Wage growth of 3.2% is positive but insufficient to restore labor's share of national income, and too low to conclude that labor markets are tight. Because 19 states boosted their minimum wage, wages in leisure and hospitality (the bulk of whom are fast-food workers) gained 4.7% in wage growth, while in manufacturing wages only rose 2.4%. The Federal Reserve's Open Market Committee made the right decision to hold back on further rate increases.
In response to the January job numbers, AFL-CIO Chief Economist William Spriggs tweeted:
#JobsReport #NumbersDay another sensitive area to the federal government shutdown, payrolls at museums, historical sites down 200. Some employees at these facilities are private contractors @AFGENational @AFLCIO— William E. Spriggs (@WSpriggs) February 1, 2019
#JobsReport in the broadest measure of unemployment (U-6 including part-time workers who wanted full-time work) jumped up to 8.1%. Suggesting some private contract workers got reduced hours instead of being totally laid off during the shutdown @AFGENational @AFLCIO pic.twitter.com/1jpznG7YGE— William E. Spriggs (@WSpriggs) February 1, 2019
#JobsReport Not a good sign, Hispanic unemployment rate increased in January from 4.4 to 4.9%, partly from an increase in participation but also a drop in employment of 122,000 @AFGENational @AFLCIO @LCLAA @Marietmora @WeAreUnidosUS— William E. Spriggs (@WSpriggs) February 1, 2019
#JobsReport A likely outcome of the federal government shutdown was the 560,000 increase in workers reporting part time work who wanted full-time work, but had reduced hours because of business conditions @AFGENational @AFLCIO— William E. Spriggs (@WSpriggs) February 1, 2019
#JobsReport Compared to last January, wages were up 3.2%. A good gain, but still modest for now the longest streak of monthly job gains. The @federalreserve FOMC made the right call to keep rates constant. @AFLCIO— William E. Spriggs (@WSpriggs) February 1, 2019
Last month's biggest job gains were in leisure and hospitality (74,000), construction (52,000), health care (42,000), professional and business services (30,000), transportation and warehousing (27,000), retail trade (21,000), manufacturing (13,000), mining (7,000) and federal government (1,000). Employment showed little change over the month in other major industries, including wholesale trade, information and financial activities.
Among the major worker groups, the unemployment rates rose for teenagers (12.9%), blacks (6.8%) and Hispanics (4.9%). The jobless rate declined for Asians (3.1%). The jobless rate for adult men (3.7%), adult women (3.6%) and whites (3.5%) showed little change in January.
The number of long-term unemployed (those jobless for 27 weeks or more) declined in January and accounted for 19.3% of the unemployed.