The January jobs report is out. 517K jobs were added in January vs. 188K expected. The unemployment rate was lower at 3.4 percent, the lowest since May 1969. The labor force participation rate of 62.4% was unchanged from December after adjustment, which is still 0.9 percentage points below the value pre-pandemic in February 2020. Average hourly earnings rose 0.3% MoM and 4.4% YoY, higher than the 2% inflation rate the Fed targets.
Apparently, the labor market is still really strong and the unemployment rate is super low. According to the report, only jobs in information technology, utilities and automotive manufacturing experienced negative growth and the whole economy added 517K jobs in January. It will be interesting to see what the jobs report will look like once the big tech are done with their layoffs. Will we see an uptick in the unemployment rate or will the laid off workers quickly find their next high paying jobs? There’s a lot of uncertainty. Hopefully we will have some clarity on that in a quarter or two.