January more jobs than economists expected, led by gains in retail trade, construction and financial activities.
Total nonfarm payroll employment increased by 227,000 in January, while the unemployment rate remained unchanged at 4.8%, according to today’s report from the Bureau of Labor Statistics.
ADP predicted this increase and more earlier this week as its data showed an increase of 246,000, however with its spotty record, economists’ expectations were much more modest.
“The Street is looking for a 175k nonfarm payrolls in Friday's report,” Brent Nyitray, iServe Residential Lending director of capital markets wrote Wednesday in his note to clients.
This increase is significantly higher than December’s increase of 156,000 jobs.
However, one economist predicted an increase of 225,000 jobs. Steve Rick, CUNA Mutual Group chief economist, explained in an interview with HousingWire that the jump in business optimism since the election of President Donald Trump pushed many employers to create new jobs.
However, while this gain was significant, the labor force increased by 584,000 in January, bringing the labor force participation rate to 62.9% of the population.
Here are where some of the major gains in jobs occurred in January:
Retail trade: Increased 46,000
Construction: Increased 36,000
Financial Activities: Increased 32,000
Professional and technical services: Increased 23,000
Food services: Increased 30,000
Health care: Increased 18,000
Employment in other major industries, including mining and logging, manufacturing, wholesale trade, transportation and warehousing, information and government, showed little change over the month.
The increase in construction will be a welcome relief to the supply-starved housing market.