Hiring Slows in January, But Unemployment Rate Drops and Wage Gains Continue

Jobs, Skills and Training

Employers added 151,000 jobs in January as the unemployment rate dropped to 4.9 percent for the first time in eight years, yet the new jobs came significantly slower than the monthly average of 215,000 over the past six months.  Average weekly and hourly earnings have increased 2.5 percent over the past year, significantly faster than the 0.7 percent increase in consumer prices and 0.3 percent gain in productivity.  Though several industries had sizable job gains in January, others significantly reduced employment.  In January, three industries accounted for 94 percent of the job growth:

• Retail Trade (+57,700);
• Restaurants and Bars (+46,700); and
• Healthcare (+36,800).

Notably, educational services (-38,500), employment services (-28,800), and transportation and warehousing (-20,300) posted sizable job losses in January.  However, job gains in manufacturing (+29,000) and professional and technical services (+25,300) helped to offset those losses.  Despite the recent slowdown in economic growth, business economists expect employers to add an average 184,000 jobs per month in 2016; however, the 4.5 percent jump in unit labor costs at the end of 2015 could limit job growth early this year.  There are almost 313,000 jobs waiting to be filled on WeHireAmerica.jobs, the Association's job board.