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US Employment Report Is Better Than It Looks

Posted Friday, February 7, 2020 by
Skerdian Meta • 1 min read

The employment report from the US for January was released earlier today and at first glance it looked soft. The unemployment rate ticked higher, while earnings missed expectations. But, looking into the details, it’s not so bad after all. Earnings still increased and new jobs jumped higher. Have a look at the details for yourself.

  • US January non-farm payrolls +225K vs +165K expected
  • Prior was +145K (revised to +147K)
  • Annual revisions cut 514K jobs from 2018-2019 payrolls
  • Estimates ranged from +120K to +202K
  • Two month net revision +7K
  • Unemployment rate 3.6% vs 3.5% expected
  • Participation rate 63.4% vs 63.2% prior
  • Avg hourly earnings +0.2% m/m vs +0.3% exp
  • Prior avg hourly earnings +0.1%
  • Avg hourly earnings YoY +3.1% vs +3.0% exp
  • Prior avg hourly earnings 2.9%
  • Avg weekly hours 34.3 vs 34.4 exp
  • Private payrolls +206K vs +155K exp
  • Manufacturing -12K vs -2K exp
  • U6 underemployment 6.9% vs 6.7% prior

There are some red numbers and some green ones. But, the green ones are more important, considering that the unemployment rate is still pretty low, despite ticking higher to 3.6%, while earning increased by 0.2%, more than in December, also despite higher expectations. Those were the two most important red components, and they aren’t so bad after all. So, the whole report leans more towards the positive side, especially after the jump in new jobs.


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