- The US economy added 467,000 jobs in January, vastly above the median forecast for 150,000 new payrolls.
- The unemployment rate rose to 4%, landing above the median forecast of 3.9%.
- The report shows hiring rebounding despite the US sitting in the peak of the Omicron wave.
Hiring unexpectedly accelerated in January as the Omicron variant reached its peak in the US.
The US economy added 467,000 nonfarm payrolls last month, the Bureau of Labor Statistics announced Friday morning. That vastly exceeded the median estimate of 150,000 new jobs from economists surveyed by Bloomberg.
November's job gains were revised a second time to 647,000 jobs from 249,000, according to the report. December's preliminary print was updated to 510,000 from 199,000. The dual revisions signal hiring fared far better in the final months of 2021 than the initial data suggested.
The unemployment rate rose to 4% from 3.9%. That landed above the median forecast of 3.9%.
The Friday report is the first to catalog the Omicron wave's full effects on the labor market's recovery. The report's survey period ended just after daily case counts peaked on January 10 at more than 1.4 million. By comparison, December's preliminary reading only tracked job creation through the start of the wave, when daily infections averaged roughly 120,000. The Omicron variant's spread forced millions to call out sick in January, providing an early indication of the jobs report's lackluster data. And while case counts have fallen over the last few weeks, they remain elevated compared to previous waves.
The labor force participation rate rose to 62.2% from 61.9%, marking a healthy improvement after months of little change. The measure has taken on new importance during the recovery as millions of Americans sit on the labor market's sidelines. Participation had been slow to recover, leaving employers struggling to hire as the worker supply remains strained. Yet the uptick in January suggests more people sought work even amid the Omicron wave. The improvement is also behind the gain in the unemployment rate, as an increase in job searchers will lift the overall number of unemployed Americans.
The number of jobless adults was little changed at 6.5 million through January. The US still has roughly 2.9 million jobs to create before returning to its pre-crisis count. Even when those payrolls are recovered, total jobs will still only be at their February 2020 levels. It will likely take several more months to recoup the job growth lost during the pandemic.
The average hourly wage rose by $0.23, or 0.7%, to $31.63 in January, according to the report. That exceeded the median forecast for a 0.5% jump. The print shows wage growth continuing to outpace its historical average as the labor shortage entered the new year. The phenomenon has forced businesses to issue larger raises to more efficiently attract workers. The pay bumps have raised some concerns around higher inflation, but healthy productivity growth through the fourth quarter suggests the country is far from facing a wage-price spiral.
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