February 3, 2017
January 2017 Job Reports
Unemployment Rate: 4.8 percent
Jobs Created: 227,000
Employment and Unemployment
- The Department of Labor reported an unemployment rate of 4.8 percent for January, up 0.1 percent from last month.
- Today’s jobs report shows an increase of 227,000 nonfarm jobs in January, higher than analysts’ prediction of job growth of 174,000. Employment for November was revised down from 204,000 to 164,000 jobs created; and December was revised up from 156,000 to 157,000.
- Unemployment in January among those ages 16-19 was 15.0 percent, up 0.3 percentage point from last month. For people of Hispanic or Latino ethnicity, the unemployment rate was 5.9 percent, unchanged from December. For African-Americans, the unemployment rate was 7.7 percent, down 0.1 percentage point from the prior month.
- The number of long-term unemployed, those unemployed for 27 weeks or more, was 1.9 million, up from 1.8 million last month. They account for 24.4 percent of the unemployed, up from 24.2 percent in the prior month.
- The “real” unemployment or U-6 rate is 9.4 percent, up 0.2 percent from last month. This is the total percentage of unemployed and underemployed workers. The rate averaged 8.3 percent in the two years before the recession.
- The “real” number of unemployed Americans is 15.2 million. These are people who are unemployed (7.6 million), want work but have stopped searching for a job (1.8 million), or are working part time because they cannot find full-time employment (5.8 million).
- In January, employment grew by 46,000 in retail trade; 36,000 in construction; 32,000 in financial activities; 30,000 in food services and drinking places; and 18,000 in health care. Employment in transportation and warehousing fell by 4,000; telecommunications lost 3,800 jobs; and state government lost 9,000 jobs last month.
- In its February 1 statement following the recent meeting of the Federal Open Market Committee, the Federal Reserve stated: “Information received since the Federal Open Market Committee met in December indicates that the labor market has continued to strengthen and that economic activity has continued to expand at a moderate pace. Job gains remained solid and the unemployment rate stayed near its recent low….the Committee decided to maintain the target range for the federal funds rate at 1/2 to 3/4 percent.”
- The Federal Reserve next meets March 14-15.
- Labor Force Participation
Labor Force Participation
- The labor force participation rate is 62.9 percent, up 0.2 percentage point from last month and remaining near the lowest level in 38 years.
- As noted by the Wall Street Journal, “The report portrayed a labor market that carried momentum into 2017 as Donald Trump’s administration took office.”
- Despite the recent increase in the labor force participation rate, many workers remain on the sidelines. Since October 2013, the participation rate has largely been stuck in a narrow range of 62.5 to 63 percent. Prior to the recession, the rate was 66 percent.
- The share of American adults with jobs in January was 59.9 percent, up 0.2 percentage point from last month. This is nearly 4 percentage points below its pre-recession peak.
- In January, average hourly earnings for all employees on private nonfarm payrolls increased by 3 cents to $26.00, following a 6 cent increase in December. Over the year, average hourly earnings have risen by 2.5 percent.
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