Key Takeaways from the January Jobs Report

While the headline number of 151,000 payroll increases in the most recent jobs report was generally disappointing to economists, there were a number of bright spots in the jobs report. Health care and manufacturing showed significant increases, and wage gains over the past twelve months increased by 2.5 percent.

Health care and manufacturing were among the leading sectors for job gains in January.
  • Total U.S. employment rose by 151,000 in January, and the unemployment rate was little changed at 4.9 percent. The 151,000 jobs added last month was below economists expectations of 185,000, and significantly less than the previous three months average (each of the last three months had job gains of 250,000 or more.)
  • Two of the key highlights in the jobs report were job gains in manufacturing and wage increases:
    • Manufacturing added 29,000 jobs in January, following little employment change in
      2015. Over the month, job gains occurred in food manufacturing (+11,000),
      fabricated metal products (+7,000). Both of these industries have a significant economic presence in the South Central region.
    • There was also a slight gain in wage growth, as average hourly earnings rose 0.5% to $25.39. In the past year, average hourly earnings have risen 2.5%.
  • Focus on how South Central’s in-demand sectors fared across the country in January:
    • Job gains occurred in several industries including health care (+39,000) and manufacturing (+29,000)
    • Employment declined in transportation and warehousing (-20,000)
    • Other sectors of note: Retail and trade gains were significant (+58,000), while professional and business services (+9,000) disappointed economists.
  • Both civilian labor force participation (62.7 percent) and long-term unemployed (2.1 million) remained essentially unchanged in January. However, the long-term unemployed make up 26.9 percent of the total unemployed person in the U.S., which is down from 31.3 percent last January.