US Unemployment Rate Drops To 6.3 Percent As 49,000 Jobs Added In January
January saw the United States add 49,000 jobs as the unemployment rate dropped to 6.3 percent, as reported by Yahoo! Finance. This signals a 0.4 percent drop in the rate, according to the Labor Department. Friday’s release of data reveals that the economy appears to once again be heading toward recovery after jobs declined in December, the first month of declining numbers since April.
The growth is credited to the easing of restrictions and federal stimulus measures in response to the continuing coronavirus pandemic. However, the numbers defied predictions from economists that the rate would remain the same while as many as twice as many jobs would be added. This means that the drop in unemployment is more related to fewer people in the labor force participation rate than a full turnaround.
The Department of Labor also announced several revisions in its Friday data release, revealing a higher loss of jobs in November and December than previously reported. November saw an extra 72,000 job losses while December saw an additional loss of 87,000, with the months seeing total losses of 264,000 and 227,000, respectively.
While there appeared to be solid growth in professional services and the education field, it wasn’t enough to counterbalance the loss of jobs in fields such as leisure and hospitality, retail, health care, transportation and warehousing industries, according to the Bureau of Labor Statistics and reported by The Hill. Leisure and hospitality saw a loss of 61,000 jobs in January following a devastating December that saw more than 500,000 lose their jobs. The field has been one of the hardest hit during the pandemic, with Yahoo! Finance reporting a net loss of 3.8 million jobs since before the pandemic, making up a significant amount of the net 10 million jobs lost since February 2019.
Retail and health care saw reversals of their rising numbers in December, as retail saw its holiday gain of 134,900 in December turn into a loss of 37,800 in January. Health care saw its roughly 40,000 jobs added in December fall by about the same amount. However, some fields saw consistent gains. Professional and business services built on the 156,000 jobs added in December with 100,000 more in January, while wholesale trade saw a January gain of 14,000 following 15,500 added in December.
January did appear to show the labor market conditions stabilizing, as permanent job losers stood consistent at 3.5 million. There is also some speculation that the timing of the survey means the full scope of recovery in January may not have been reported. The survey took place during the week of January 12, which saw jobless claims spike at more than 900,000 but decline since.
