How the Job Market Looked at the Start of the Year, Shutdown and All

U.S. employers added 304,000 jobs in January and the unemployment rate edged up to 4%. The partial government shutdown entered into unemployment figures but didn’t appear to affect overall job creation.

Over the past year, the number of jobs has grown by 1.9%, an acceleration from a year ago. The economy is now adding jobs at the best clip since 2016.

The unemployment rate climbed to 4% in January, which is the highest since June. Broader measures of unemployment, which include discouraged workers or part-time workers seeking full-time employment, also rose. These figures were elevated due to the government shutdown.

The unemployment rate climbed for workers of all race and gender groups last month, with an especially large jump for black men, who saw their unemployment rate climb from 5.8% in November to 7.1% in this report. (Once again, these figures were elevated due to the shutdown and may come back down in February.)

Workers with college degrees saw the biggest jump in unemployment last month, whereas workers without a high school education actually saw their unemployment rate fall slightly. This may partially reflect the effects of the shutdown, and the relatively high level of education in the federal workforce.

The share of the population that is in the labor force, that is either working or looking for work, climbed slightly to 63.2%, the highest since 2013. The share of the population with a job also climbed slightly, reaching its highest mark since 2008.

Participation rates climbed among workers age 25 to 54, when education and retirement keep fewer people out of the labor force. The share of this group with a job reached its highest level since 2008.

The median duration of unemployment lasted for just under 8.9 weeks in January. Though improved from readings earlier this decade it’s still longer than during last decade’s housing boom, or during the late 1990s.

Wages, on a both a weekly and hourly basis, continued to climb at a pace above 3% per year. With inflation coming back down slightly, after popping higher in 2018, workers have better real incomes too.

Job gains continue to be strongest in the relatively high-skilled categories of health care and professional business services. Federal government employment has been mostly flat.

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from Real Time Economics https://on.wsj.com/2Tqvtft