US adds just 151k jobs in Jan.; 4.9 pct. jobless rate

Within that industry sector, professional and technical services added 25,000 jobs for the month, in line with average monthly gains over the prior 12 months, but employment in temporary help services edged down in January by 25,000, after edging up by the same amount in December.

The U.S. Department of Labor released the jobs report for January 2016, and the numbers are worse than economists predicted.

The unemployment rate dropped to its lowest in eight years despite the big hiring miss last month.

Also taking the sting from the softer payrolls number, employers increased hours for workers. Restaurants and bars added 48,800 jobs in a sign of robust consumer demand.

“We’re going through a period of decelerating employment, not that we’re going to go negative”, says Phil Orlando, chief economist at Federated Investors. Last year’s numbers rivaled the booming 1990s. Prices for U.S. Treasury debt fell and U.S. stock futures extended losses.

“The fed funds futures market apparently wrote off a March rate hike before this report”, Duncan said. Over the slightly longer run, the U.S.is adding almost 2.7 million jobs per year; that’s down a bit from a year ago, when the annual rate of growth topped 3 million, but it remains an impressive figure.

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.

For the past several years, hiring has been strong and fewer and fewer people have filed unemployment benefits. The percentage of unemployment due to voluntary job leavers also dropped in January, indicating a lack of confidence in the labor market.

A separate report from the Commerce Department showed the buoyant dollar cutting into exports in December, causing the trade deficit to widen 2.7 percent to US$43.4 billion. “It’s reasonable to expect a slower pace of payroll growth in the January data”.

Average hourly wages rose 12 cents to $25.39, and are up 2.5% the past year, possibly reflecting an acceleration as the labor market tightens.

Plus, some worry if job growth continued at its strong pace in 2015, it could lead to inflation rising faster than expected, forcing interest rates to go up rapidly.

Additionally, the agency incorporated new Census Bureau population estimates into the household survey. The number of workers marginally attached to the labor force, including discouraged workers, was essentially the same as a year earlier.

Also, the labour-force participation rate rose to 62.7% from 62.6%. The PayScale Index, which measures the change in pay for employed US workers, forecasts a 1.4 percent year-over-year increase for the first quarter of 2016.

Still, a job gain of 151,000 is decent and unemployment is very low.

The economy’s transportation and warehousing sector, the umbrella industry for truck transportation, lost 20,300 jobs in the month. Since mining payrolls reached a peak in September 2014, they have fallen 16 percent. January’s jobs report was “a mixed bag”. “That 151,000 gain in non-farm payrolls included a barely believable 29,000 increase in manufacturing”. Courier services jobs fell 14,400.

The income growth meshes with retailers hiring a seasonally adjusted 57,700 workers.