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The country begins the year with a few hundred thousand new jobs, but in the words of the Bureau of Labor Statistics (BLS), “the unemployment rate was little changed at 4.0 percent.” Although the statistical department announced little change in the unemployment rate, hiring quadrupled the expected figure with nearly 467,000 more people in January.
Although the increase in jobs is considerably higher than the numbers seen in December, it is less than the average number of new jobs during 2021, which corresponded to 555,000 new jobs per month.
Currently, there are about 6.5 million Americans who remain unemployed. In February 2020, before the pandemic, the unemployment rate was 3.5% and there were about 5.7 million unemployed Americans. In 2021, the economy recovered nearly 3.7 million jobs.
The unemployment rate among Hispanics remains at 4.9%; among the African-American population at 6.9%; among Asians at 3.6% and among whites (non-Hispanics) at 3.4%. According to BLS, the unemployment rate among Hispanics “showed little or no change over the month.”
In January, the participation rate, the number of people who are employed or looking for a job, was 62.2%. Over the past two decades, the participation rate has been declining, suffering its largest drop at the beginning of the pandemic in March 2020. Since then, many Americans have decided not to return to looking for a job for a variety of reasons.
The BLS report notes that there are another 5.7 million people who want to work at some point, but were not included in the unemployment statistic because they were not looking for a job in the last four weeks.
While the Omicron variant does not appear to be discouraging economic growth, it has impacted the way Americans work. In January, the number of people who reported telecommuting grew by 15.4%. Some economists wonder if the expansion in contagions is at least partly a response to the increase in hiring over the past few months.
The leisure and tourism sectors generated about 151,000 jobs in January, the food and beverage industry more than 108,000, while the hospitality industry created 23,000 jobs, and the rest in other types of businesses within this sector.
The business services sector added 86,000 jobs; retail added more than 61,000 jobs. Job growth was primarily in merchandise stores, with more than 29,000 jobs added during January.
In the transportation and warehousing sectors, more than 54,000 new jobs were created. This sector is notable for having added more than 542,000 jobs than it had in February 2020, reflecting the need for more personnel to end bottlenecks in supply chains.
Local education employment increased by 29,000 jobs, but there are still 387,000 fewer teachers than in February 2020.
Despite the good news, financial markets did not respond positively and, in fact, declined following the news. Some analysts anticipate that January’s positive numbers would help strengthen the Federal Reserve’s (FED) confidence to raise interest rates, which would reduce the liquidity available in the country’s future.
With reduced liquidity, not only will financial markets have less money to capitalize rates, but a reduction in consumption is anticipated to help contain inflation, which reached 7% during 2021.
Economist, writer and liberal. With a focus on finance, the war on drugs, history, and geopolitics // Economista, escritor y liberal. Con enfoque en finanzas, guerra contra las drogas, historia y geopolítica