US job creation surges in January, adding 225,000 positions

The American economy saw an explosion of new hiring in January, possibly helped by mild weather but getting the year off to an impressive start, according to key government data released Friday.

The report, which showed the biggest employment increase since January of last year, will be a boon to President Donald Trump, who has emerged intact from his impeachment and trial and can now trumpet his economic record as he battles to win re-election in November.

Still, after more than a decade of steady growth and job gains, and with steep tariffs on many products from China still in place, it is questionable whether the hiring pace can continue, especially since the economy is projected to slow this year.

US employers added 225,000 new non-farm jobs last month, far surpassing expectations, thanks to big gains in construction and leisure and hospitality, but also health care and transportation, the Labour Department reported.

The blockbuster number was a rebound from a tepid December report, but the latest gains mean the economy added an average of 211,000 jobs in the last three months.

That is a healthy improvement on the 175,000 average of 2019 when the economy cooled amid Trump's multifront trade wars that led to tariffs on huge amounts of imports and American goods sold abroad.

Even with the stunning job gains in January, the unemployment rate ticked up by a tenth to 3.6 per cent. But that can be attributed to an increase in the labour force, as more people returned to the job market, and the jobless rate still remains near a 50-year low.

"Amid virus-induced fears of a sharp economic slump, strong job creation and firming wage growth in January provided reassurance that the record-long economic expansion still has room to run," Oxford Economics analysts said.

However, they said, "employers continue to face a volatile and uncertain global environment which, along with a cooling domestic backdrop, will lead them to be more cautious hiring."
"The president took a victory lap by signing the China 'Phase 1' and USMCA deals, but out in the real world, the manufacturing sector is still hurting."