U.S. employers added 151,000 jobs in January, a deceleration from
recent months as companies shed education, transportation and
temporary workers but hired others in manufacturing, retail and food
services.
The unemployment rate dipped to 4.9 percent, its lowest level since
early 2008.
The report Friday from the Labor Department showed that employers
are still hiring steadily, though at a slower pace. The January
figures follow seasonally adjusted job growth of 262,000 in December
and 280,000 in November.
The broader hiring slowdown reflects an increasingly muddled picture
for the U.S. economy. Global financial pressures and a volatile
stock market have curtailed growth. But January's jobs report
appears to have further clouded the economic outlook as it showed
that consumers are faring better despite steep declines in several
industries.
Consumers appear to be resilient, even as sectors of the economy
seemingly insulated from the slowdown in China, downturn in Brazil
and fragility in Europe slipped.
The number of people working or searching for jobs increased last
month, while the number of unemployed slipped from 7.9 million to
7.8 million — causing the unemployment rate to decline.
Average wages jumped 2.5 percent over the past year to $25.39 an
hour, evidence that the past years of job growth are helping to
generate larger pay raises. The income growth meshes with retailers
hiring a seasonally adjusted 57,700 workers. Restaurants and bars
added 48,800 jobs in a sign of robust consumer demand.
With low gas prices leaving more money in consumers' wallets and
borrowing costs low, most economists expect Americans to spend
at a decent pace this year and bolster economic growth.
Manufacturers hired a solid 29,000 workers last month, even
though other indicators show factory activity weakening as the
rising value of the dollar and the sluggish economies of major
trade have squeezed exports of U.S. goods. The Institute for
Supply Management's manufacturing index has been below 50 for
four months, signaling contraction. Orders for factory goods
plunged in 2015 — the first annual drop since 2009, when the
economy was just emerging from recession.
The health care sector added a solid 44,000 last month.
But other sectors of the economy hit a speed bump in January.
Education services — an area sheltered from the global economy—
let go of 38,500 workers after steady gains in prior months.
The transportation and warehousing sector downsized by 20,300,
likely letting go of seasonal workers after the holiday shopping
rush ended. The U.S. Postal Service also parted with 6,000 jobs.
Yet the most notable decline was in temporary workers, whose
ranks fell by 25,200 in January. The decrease could indicate
that companies are wary that the economy can continue its 6
˝-year expansion at its previous pace. Corporate profits are
declining and goods are piling up on warehouse shelves.
Those trends have elevated concern that a U.S. recession may
loom in the next year or two.
Most analysts say that while the economy may slow this year
compared with 2015, an outright recession remains unlikely.
Economists at Bank of America Merrill Lynch have put the odds of
a recession within the next 12 months at 20 percent. While still
low, that estimate is up from 15 percent last year.
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