Economy adds 200K jobs in January

The U.S. economy added 200,000 jobs in January, which was better than predicted, giving the economy a strong start to the year amid anticipation that a Republican tax package will further boost the nearly nine-year expansion.

The unemployment rate held at 4.1 percent for the fourth straight month, the lowest level since December 2000, when it was 3.9 percent, the Labor Department reported on Friday.

There were 24,000 fewer jobs created in November and December than initially reported.

“This report marks a strong start to 2018 as our economy continues to improve under President Trump,” said House Ways and Means Committee Chairman Kevin Brady (R-Texas).

{mosads}

“Every day, American businesses are making commitments to invest in the greatest asset our nation has: the American people,” Brady said.

House Democratic Whip Steny Hoyer (Md.), however, argued that the jobs report actually shows that the economic work done during the Obama administration “to help the private sector get more Americans back to work continues, if more slowly, under President Trump.”

“Since taking full control of our government a year ago, the Republican Congress and president have launched an all-out assault on middle-class workers and their families, kicking millions off their health coverage and raising their taxes in order to benefit the wealthiest 1 percent,” Hoyer said.

In the past year, the jobless rate has dropped from 4.8 percent.

Employers have added jobs for 88 straight months.

Job gains have averaged 192,000 over the past three months.

The economy is expected to continue its pace of steady jobs growth this year with the help of a $1.5 trillion Republican tax package signed by Trump.

Meanwhile, the unemployment rate is expected to fall into the mid-3 percent range in 2018, although economic growth may still struggle to reach Trump’s target of at least 3 percent.

A particular bright spot in the report was wages finally showing more promise, accelerating to an annual pace of 2.9 percent as the labor market tightens and states raise their minimum wage levels.

Jed Kolko, chief economist for jobs website Indeed, said the best news in the report was the much-awaited jump in wages, which is the fastest annual increase since May 2009.

“So January’s jump in wages probably overstates what workers are seeing in their paychecks,” Kolko said.

“Still, these broader employment measures remain near their post-recession bests, and wages are moving in the right direction,” he said.

Gus Faucher, PNC’s chief economist, said the job market this year is in good shape even though the labor market will face challenges as fewer workers will be available for open positions.

“The availability of labor is the big problem, not demand for workers,” Faucher said.

“Job growth will slow somewhat this year from its pace in 2017 because of a difficulty in finding workers but will remain solid,” he said.

“The unemployment rate will move below 4 percent over the course of 2018, and the tight job market will lead to stronger wage growth.”

But black unemployment, which had been sitting at a record-low 6.8 percent, jumped to 7.7 percent last month, well above the 3.5 percent for whites.

In the past month, Trump has repeatedly boasted about the previous black unemployment level, saying that the drop reflected how well his policies are working.

Last week, during his visit to the World Economic Forum in Davos, Switzerland, Trump touted his economic achievements, taking credit for the steady growth in job creation and the red-hot stock market.

“After years of stagnation, the United States is once again experiencing strong economic growth,” Trump said. “The world is witnessing the resurgence of a strong and prosperous America.”

During his State of the Union address on Tuesday, Trump said the new tax law will further bolster the overall strength of the U.S. economy.

On the heels of the tax legislation, hundreds of companies have announced raises and bonuses.

The economy in the final three months of last year grew at a slower pace than expected — 2.6 percent — and expanded at a 2.3 percent pace for the year, which was better than 2016’s 1.5 percent growth rate.

The economy added 2.17 million jobs in 2017, up from the 2.05 million initially reported after revisions to the data.

The makes last year’s labor market expansion the slowest since 2012.

Last year marked the seventh straight of annual employment growth above 2 million, which is the longest streak since the technology boom of the late 1990s.

Overall though, employment continued to improve in construction, restaurants and bars, health care, and manufacturing.

Construction added 36,000 jobs in January, including 5,000 in residential building construction. Overall in the past year, construction employment has increased 226,000 jobs.

Manufacturing added 15,000 jobs and have tacked on 186,000 to payrolls over the past year.

Employment in restaurants and bars increased 31,000. The industry has added 255,000 jobs in the past 12 months.

The health care industry added 21,000 jobs, with a gain of 13,000 in hospitals. In 2017, health care added an average of 24,000 jobs a month.

Mining added 6,000 jobs, and retail hired 15,400 after shedding 25,600 jobs in December.

Updated at 10:59 a.m.