Non farm payroll growth slowed more than expected in Jan as the boost to hiring from unseasonably mild weather faded, but surging wages and an unemployment rate at an eight-year low suggested the labor market recovery remains firm.
Non Farm Payroll Growth Last Month
Nonfarm payrolls increased by 151,000 jobs last month and the unemployment rate was at 4.9 percent, the lowest since February 2008, the Labor Department said on Friday.
Data for November and December was revised to show 2,000 fewer jobs created than previously reported.
Economists polled by ForexSQ had forecast employment increasing by 190,000 and the jobless rate steady at 5 percent.
Also taking the sting from the softer payrolls number, employers increased hours for workers.
Manufacturing, which has been undermined by a strong dollar and weak global demand, added the most jobs since August 2013.
The sharp step-down in job gains from the fourth quarter’s brisk clip largely reflected payback after the warmest temperatures in years bolstered hiring in weather-sensitive sectors like construction.
January employment also lost the lift from the hiring of couriers and messengers, which was buoyed in November and December by strong online holiday sales.
But coming in the wake of an abrupt slowdown in economic growth in the fourth quarter and a sharp stock market sell-off, the closely watched employment report could add to concerns the U.S. economic outlook was deteriorating.
Federal Reserve Chair Janet Yellen has said the economy needs to create just under 100,000 jobs a month to keep up with growth in the working age population.
Against the backdrop of tightening financial market conditions, the deceleration in employment growth could further undercut the case for a Fed interest rate hike in March.
The U.S. central bank raised its short-term interest rate in December for the first time in nearly a decade.