The unemployment rate ticked up to 5.7 percent in January, but for a good reason. The economy gained 257,000 jobs, while average wages jumped by the most in six years.
According to the most recent monthly report from the Bureau of Labor Statistics (BLS), the private sector netted 267,000 nonfarm job gains in January. Local, state and federal governments lost 10,000 jobs.
The total net job gains in January were 257,000. The unemployment rate ticked up 0.1 percent, because more unemployed workers re-entered the job market thanks to the improving economy.
The private sector has now gained nonfarm jobs for 59 consecutive months since the Great Recession, the longest streak of uninterrupted job growth in U.S. history. The unemployment rate has dropped 4.3 percentage points from the recessionary high of 10 percent in October 2009.
The most impressive January job gains occurred in retail trade. The industry added 46,000 jobs, with sporting goods, hobby, book and music stores, motor vehicle and parts dealers, and nonstore retailers adding about half of those.
At 38,000, health care again added jobs. The industry netted an average of 26,000 jobs per month in 2014. Much of the industry’s steady job growth over the past few years, even throughout the Great Recession, is attributable to the increasing medical demands of aging baby boomers and the ever-growing obesity epidemic, and to provisions in the Affordable Care Act (“Obamacare”) as well.
The food services and drinking places industry gained 35,000 jobs in January. Job growth in the industry averaged 33,000 per month in 2014.
Job growth continued in the professional and business services industry, at 33,000. Within the industry, computer systems design gained 8,000 of those while architectural and engineering services gained the same.
Manufacturing, an industry that economists consider to be a gauge of labor-market health, netted 22,000 jobs in January. Construction, also a measure of labor-market health, netted 39,000 jobs.
Among the major work groups tracked by the BLS, teenagers again suffered the highest unemployment rate (18.8 percent) followed by blacks (10.3), Hispanics (6.7), adult men (5.3), adult women (5.1), whites (4.9) and Asians (4.0, not seasonally adjusted). Only teenagers experienced a significant rise (2.0 percent) in their unemployment rate in January.
Workers who are 25 years of age or older and who have earned four-year college degrees or higher experienced a 2.8 percent unemployment rate in January, down slightly from 2.9 in December. Those in the same age group and who don’t have high school diplomas suffered a much-higher 8.5 percent rate, down slightly from 8.6 in December.
The unemployment rate has been hovering between 5.6 and 5.9 percent since September 2014, when it was 5.9 percent after falling from 6.1 in August. Economists consider an unemployment rate of 5.0-5.5 percent to be normal and a sign of a healthy economy.
The number of workers that the BLS counted as unemployed in January was 9.0 million. That was up from 8.7 million in December, because more unemployed workers started looking for jobs. The BLS doesn’t count workers as unemployed, unless the unemployed workers report that they are actively seeking employment.
The count of unemployed workers does not include those who are involuntarily working only part time and with fewer benefits, if any, such as no health insurance, because they can’t find full-time jobs or employers cut their work hours. The number of involuntarily part-timers in January was 6.8 million, the same as in December.
The average workweek for all part-timers and full-timers in the private sector was 34.6 hours in January, the same as in December. Their average hourly earnings jumped up 12 cents to $24.75, the largest increase since 2008. Average earnings increased by 7 cents to $20.80/hour for private-sector production and nonsupervisory employees.
The unemployment rate also does not include “marginally-attached” unemployed workers. The BLS does not count them in the official rate because they stopped looking for work in the four weeks preceding the count, for reasons such as school attendance, family matters or their collective perception that there simply are no jobs.
The number of marginally-attached workers in January was 2.2 million, down from 2.3 million in December. Among the marginally-attached, 682,000 were so-called “discouraged workers” because they gave up looking for work due to their shared perception that there are no jobs — at least not for them. The number of discouraged workers was down significantly from the 740,000 that the BLS initially reported for December. (The BLS does not seasonally adjust any of the figures in this paragraph.)
The number of long-term unemployed workers, those who have been without jobs for 27 weeks or longer, was 2.8 million in January, the same as in December. These workers accounted for 31.5 percent of the unemployed. The number of long-term unemployed workers has declined by 828,000 over the past 12 months. Standard state unemployment benefits last only up to 26 weeks without extensions.
If you are a recent victim of job loss or a reduction in work hours resulting from the high unemployment rate, then you might be eligible to collect full or partial unemployment benefits from the state unemployment office. You might also be eligible to continue your employer-provided group health insurance coverage through COBRA.
For more details about the January 2015 unemployment rate and job numbers, see the “Employment Situation Summary” by the BLS. The BLS plans to report the February 2015 unemployment rate and job numbers on March 6. To receive notification like the above automatically, subscribe to Employee Rights Blog for free.
– – –
Certain figures in this unemployment rate report were rounded and/or seasonally adjusted by the BLS, and are subject to revision by same (based on additional data that was not initially available). The unemployment rate chart pictured above was provided by the BLS.