Friday, February 3, 2012

Employment Up 243,000; Unemployment Down to 8.3%

From the BLS:

Total nonfarm payroll employment rose by 243,000 in January, and the unemployment rate decreased to 8.3 percent, the U.S. Bureau of Labor Statistics reported today. Job growth was widespread in the private sector, with large employment gains in professional and business services, leisure and hospitality, and manufacturing. Government employment changed little over the month.

First -- those are some very nice headline numbers.  Let's look at the details"

Professional and business services continued to add jobs in January (+70,000). About half of the increase occurred in employment services (+33,000). Job gains also occurred in accounting and bookkeeping (+13,000) and in architectural and engineering services (+7,000).

Over the month, employment in leisure and hospitality increased by 44,000, primarily in food services and drinking places (+33,000). Since a recent low in February 2010, food services has added 487,000 jobs. In January, health care employment continued to grow (+31,000). Within the industry, hospitals and ambulatory care services each added 13,000 jobs.

Wholesale trade employment increased by 14,000 over the month. Since a recent employment low in May 2010, wholesale trade has added 144,000 jobs.

Employment in retail trade continued to trend up in January. Job gains in department stores (+19,000), health and personal care stores (+7,000), and automobile dealers (+7,000) were partially offset by losses in clothing and clothing accessory stores (-14,000). Since an employment trough in December 2009, retail trade has added 390,000 jobs.

In January, employment in information declined by 13,000, including a loss of 8,000 jobs in the motion picture and sound recording industry.

In the goods-producing sector, manufacturing added 50,000 jobs. Nearly all of the increase occurred in durable goods manufacturing, with job growth in fabricated metal products (+11,000), machinery (+11,000), and motor vehicles and parts (+8,000). Durable goods manufacturing has added 418,000 jobs over the past 2 years.

Employment in construction increased by 21,000 in January, following a gain of 31,000 in the previous month. Over the past 2 months, nonresidential specialty trade contractors added 30,000 jobs.

Mining added 10,000 jobs in January, with most of the gain in support activities for mining (+8,000). Since a recent low in October 2009, mining employment has expanded by 172,000.

Government employment changed little in January. Over the past 12 months, the sector has lost 276,000 jobs, with declines in local government; state government, excluding education; and the U.S. Postal Service.

The gains are widespread -- a very positive development, as it indicates the economy is starting hit on all cylinders.  

Short version 7.5 on a scale of 10.   Good news all around.

NDD here with a few observations as well.

I'd rate the report even better, maybe an 8.5.  For once good headline numbers were matched by great internals:

  -  manufacturing workweek (leading indicator) up 0.3 to 40.9
  -  manufacturing employment up 50,000!
  -  overtime up 0.1 hour to 3.4
  -  construction employment up 21,000
  -  employment to population ration up to 58.5%
  -  November and December revised up by 60,000
  -  2011 as a whole revised up by 140,000
  - aggregate hours up 0.2 to 95.5
  - average hourly earnings up 0.2%
  - U-6 unemployment down 0.1% to 15.1%
  -  household survey numbers even stronger:  +631,000 jobs, -381,000 unemployed

These are great internals and exactly what we want to see.  The only negative is that the report still isn't good enough to make a serious dent in the number of jobs we need to recover to 2007 levels on a population adjusted basis -- for that we need over 300,000 a month.