US employers added 143,000 jobs in January, causing the unemployment rate to decrease to 4%, according to the latest data.
While the new jobs signal a strong labor market, job creation slowed from the previous months, with 261,000 jobs added in November and 307,000 in December, falling short of economists’ expectations of 170,000 new jobs.
The big picture: Despite the overall stability of the job market, there are concerns about the challenges faced by those seeking employment compared to the robust hiring trends seen in 2021-2023.
- Average hourly wages increased by 0.5% from December and 4.1% from January 2024, surpassing forecasts.
- This rise in wages could pose concerns for potential inflation, but U.S. productivity growth has helped in offsetting this by allowing companies to pay more without increasing prices significantly.
Zoom in: Sector-wise, new jobs in January were primarily concentrated in healthcare (44,000 jobs), retail (34,000 jobs), and government (32,000 jobs), accounting for 77% of the new jobs created.
- In contrast, the mining sector experienced an 8,000-job reduction. The Labor Department highlighted that external factors like the Los Angeles wildfires and cold weather in the Northeast and Midwest had minimal impact on January’s job numbers.
