This morning represented a big win for the American worker. The results are in from the Labor Department’s much-anticipated unemployment rate report, and the private sector created 257,000 jobs in January! Now, the government sector did suffer a setback to the tune of 14,000 jobs, but that wasn’t enough to derail this train; even with the public sector losses, 243,000 jobs were created. To put things in perspective, economists forecast that only 140,000 jobs would be created in January.
And the details look even better. The manufacturing sector added 50,000 jobs and the service sector boomed in terms of creating temporary jobs. It is highly likely that many of these temp workers will take on full-time work at their companies, so this is a good sign for more job creation in the coming months. American workers are also getting for better pay; hourly earnings increased 0.2% after last month’s 0.1% gain. The length of the average workweek is also holding strong at 34.5, which economists expected it to dip.
All in all, this represents the fastest rate of job growth since April! Even better, this job creation pushed down the unemployment rate to 8.3%—the lowest level in three years. The unemployment rate has been falling for the past five months, so let’s hope that this is the start of a significant trend for the labor market. Because with 12.8 million Americans who remain unemployed, there is still plenty of room for improvement.
In the meantime, this was a stunning payroll report, and the rest of Wall Street seems to agree—all of the major indices are up 1% this morning. I don’t know about you, but this represents a great start to my weekend—I’ll be back on Monday with my take on the latest market and economic headlines.