US January Non-Farm Payrolls Rise, Partially Recovering From Steep Fall in December
10:40 AM EST, 02/05/2021 (MT Newswires) -- The world's top economy added slightly fewer jobs than expected in January, partly recovering from a sharp drop the month before as some areas of the country rolled back restrictions that were reimposed to stem surging cases of COVID-19.
Non-farm payrolls rose 49,000 last month, the Bureau of Labor Statistics said on Friday, which was just below the consensus on Econoday for 50,000. December's print was revised lower to a loss of 227,000 jobs from an earlier estimate of a 140,000 slide.
The unemployment rate improved to 6.3%, ahead of December's reading and the Street's view for 6.7%.
"The big job cuts late last year appear to have ended, but the modest advance in January is underwhelming in the face of recent better data," said Sal Guatieri, senior economist at BMO Capital Markets. "Still, the outlook is brightening as the vaccine rollout gains pace, and the jobless rate keeps tracking lower."
Vaccines against the respiratory disease began in mid-December. According to the Centers for Disease Control and Prevention, more than 35.2 million doses of preventatives have been administered in the US as of Thursday morning.
Professional and business services led the advance, gaining 97,000 as temporary help services accounted for 81,000 jobs. Local government education added 49,000 while state government education rose 36,000. Private education gained 34,000 positions. Meanwhile, leisure and hospitality employment led falling sectors, declining by 61,000.
Average hourly earnings rose $0.06 to $29.96 while the average workweek ticked up 0.3 hour to 35 hours.
"The bottom line here is that the labor market was frozen at the start of the year, and is completely dependent on the pace of reopening, which in turn is contingent on the speed and sustainability of the fall in hospitalizations," said Ian Shepherdson, chief economist at Pantheon Macroeconomics, adding that reopenings in some the largest states will probably lift February's reading.
"But the big increases needed to restore the lost 10 (million)-plus jobs can't come until the economy can reopen more fully and people are confident in mingling again," Shepherdson said. "That likely will take until mid-year, but we hope that January's mere 6 (thousand) increase in private sector payrolls turns out to be the low point of the year."