The U.S. economy added 227,000 non-farm payroll positions in January, according to today’s monthly employment report released by the Bureau of Labor Statistics (BLS). This seasonally adjusted figure marks a 44.6 percent increase from December’s upwardly revised addition of 157,000 jobs, and significantly exceeds the Wall Street Journal‘s expectation of 174,000.
The national unemployment rate rose marginally from December’s 4.7 percent to 4.8 percent in January. According to the Wall Street Journal, a rising unemployment rate could “suggest [that] workers who dropped out of the labor force are returning and that the labor market has yet to reach full strength.” The labor-force participation rate, which also rose by 0.2 percentage point in January to 62.9 percent, supports this hypothesis
January’s strong report could have implications for potential home buyers, as it is anticipated that it will put pressure on the Federal Reserve to continue to raise interest rates. Wage growth was the biggest headline from December’s employment report, as average hourly earnings rose 2.9 percent from a year prior, the largest 12-month gain since 2009. All employees on private non-farm payrolls saw continued (albeit modest) wage growth in January, with average hourly earnings increasing by $0.03. Wages have increased 2.5 percent from a year prior, but the continued growth comes as no surprise, as the minimum wage increased in 19 states at the start of 2017.
The construction industry added 36,000 jobs in January, following two months of marginal growth. Residential construction employment added 9,000 jobs in January, while employment in nonresidential construction saw a bump of 3,900 jobs. The manufacturing sector continued its rebound from months of decline last month, adding 5,000 jobs. Meanwhile, payrolls in the architectural and engineering services sector added 5,900 positions in January, marking the third consecutive month of growth.
From the BLS’s historical data release: The BLS also releases detailed information subsets of key markets with a one-month lag, in this case offering more detailed information of the architectural and engineering services category’s response to the broader economy’s hiring slowdown, which began in June. The charts below highlight a monthly job-growth breakdown of the architectural services, landscape architectural services, and engineering and drafting services between December 2015 and December 2016. Details of these subcategories’ performance in January will be revealed in next month’s historical data release.