Job gains exceed expectations again in January
Job gains exceed expectations again in February
Total non-farm payrolls grew by 517,000 in January, up from 260,000 in December. Markets were expecting a gain of 185,000. The gains in employment were particularly robust in leisure and hospitality, health care and professional and business services. Employment growth was observed in both the private and government sectors. Meanwhile, the unemployment rate fell to 3.4% from 3.5% in December, the lowest level since 1969.
The tight labor market increases the likelihood of further Federal Reserve rate hikes ahead, as TD Economics’ Thomas Feltmate commented:
“While investors had previously discounted the Fed pushing rates above 5%, today’s employment numbers definitely tilt the scales in favor of more rates past March, as it is clear the labor market is still running at a pace that is far too hot.”
Total non-farm payrolls grew by 311,000 in February, down from 504,000 in January. Markets were expecting a gain of slightly over 200k. The gains in employment were particularly robust in leisure and hospitality, retail trade, government, and health care. Meanwhile, the unemployment rate ticked up to 3.6% in February from 3.4% in January, but still hovered close to multi-decade lows.
Our analysts see the labor market loosening slightly in the coming quarters as economic activity cools, although the unemployment rate is forecast to remain low by historical standards.
United States Unemployment (% of active population, eop) Data
| 2017 | 2018 | 2019 | 2020 | 2021 | |
|---|---|---|---|---|---|
| Unemployment (% of active population, eop) | 4.1 | 3.9 | 3.6 | 6.7 | 3.9 |