Employment Situation: Broad, Solid Gains with Positive 2017 Revisions

Bottom Line: Payroll Employment rose by 200k in January, compared with market expectations for an increase of 180k. Gains were across sectors with only IT shedding jobs wholesale transportation and utilities saw positive gains and revisions. There were modest revisions to the previous two months which subtracted a total of 24k jobs. Job creation has averaged 192k over the past 3 months vs. the past 12 months average of 176k. As usual this time of year, the BLS issued its benchmark revisions. Combined with the regular two month revision of -24k, this took 2017's average monthly job creation from 171k to 190k. The unemployment rate was unchanged, as household employment grew less than the increase in labor force. Over the past year, the unemployment rate has declined by 0.7 percentage points, the result of 2,354k more people finding jobs as 1,397k more people entered the labor force. Hourly earnings rose after a moderate increase in December that was revised slightly higher. Hourly earnings growth for all employees is now near a cycle high. Weekly earnings fell -0.24% after a strong 4th Quarter. The workweek fell with the 3-month average is now 34.4. Payroll Employment rose by 200k in January, compared with market expectations for an increase of 180k. As usual this time of year, the BLS issued its benchmark revisions. Combined with the regular two month revision of -24k, this took 2017's average monthly job creation from 171k to 190k. In this report Government jobs ROSE by 4k. Consequently, private sector jobs ROSE by 196k. Private education jobs rose by 12k. Overall employment is now 1.5% ABOVE its year ago level, Over the past 12 months, 2,114k jobs have been created.

• In January, the job gains were in Trade, Transportation & Utilities (+19k with 15k of those in Retail Trade),
• Professional & Business Services (+23k with the addition of 1.8k in Temp Help Services),
• Construction (+36k),
• Leisure & Hospitality (+35k),
• Education & Health Services (+26k),
• Manufacturing (+15k),
• Financial Activities (+9k),
• and Other Services (+6k).
• Jobs were shed in Information (-6k).

The Unemployment Rate was UNCHANGED in December at 4.1%, in-line with market expectations. Household employment rose by 409k while the labor force increased by 518k, resulting in an increase in the number of unemployed of 108k. The Labor Force Participation Rate was UNCHANGED at 62.7%. The Employment-Population Ratio was UNCHANGED at 60.1%. The number of people Working Part-Time for Economic Reasons ROSE by 70k to 4,926k. while Long-Term Unemployment FELL by 94k to 1,421k (accounting for 21.3% of the unemployed), while the Mean Duration of Unemployment ROSE by 0.5 weeks to 24.1 weeks. Hourly Earnings ROSE by 0.3% in January, above market expectations of 0.2%. Hourly earnings are now 2.9% ABOVE their year ago level. Weekly Earnings FELL by 0.2%, the result of the change in hourly earnings and a shorter workweek. Weekly earnings are now 2.6% ABOVE their year ago level. The Average Workweek FELL by 0.2 to 34.3 hours, BELOW the market consensus at 34.5 hours. There are now 6.7 million people officially unemployed. In addition, there are another 5,171k people who say they want a job but are not currently looking for one. Finally, another 4,926k people are working part-time because of slack economic conditions.