Job Growth Was Strong in January, Overcoming Headwinds

“I feel like people won’t breath a sigh of relief until they see a February report,” Ms. Zentner said.

Revisions alter the long-run picture.

In addition to the January figures, the jobs report on Friday included updates to data from 2018 and 2019. These “benchmark revisions” are conducted every year to align the monthly survey-based estimates with more definitive data from state unemployment insurance records, and are usually minor.

Not this year. The revisions showed that employers added 514,000 fewer jobs in 2018 and early 2019 than initially reported, mostly consistent with preliminary figures released last summer. That’s the equivalent of wiping out more than two months of job growth at recent rates, although hiring caught up a bit later in 2019 — by the end of the year, the gap between the original and revised figures had narrowed to about 400,000 jobs.

The revisions kept alive the economy’s record-setting streak of job gains, but by the slimmest of margins. Employers added just 1,000 jobs last February, down from 56,000 before the revision. The jobs streak now stands at 112 consecutive months, far and away a record.

The revisions do not change the fundamental picture of a healthy job market. But they suggest that the economic jolt delivered by the Republican tax cuts in 2018 was milder and ended sooner than it initially appeared.

“There were lots of skeptics when it passed that it would have much pass-through” to the larger economy, Ms. Coronado said of the tax law. “And now the data confirms that there wasn’t much pass-through.”

The report has political implications.

In his State of the Union address on Wednesday, President Trump sought to take credit for the strong economy. There are signs that pitch is working: Consumer confidence is up among independents, a potentially decisive constituency in the November election. Expect Mr. Trump and his backers to seize on the best elements of the report on Friday as evidence of his success.

But the economy also carries risks for Mr. Trump. Despite his claims of a “blue-collar boom,” manufacturing employment has slumped in recent months, particularly in the politically crucial Midwest. The oil industry is also struggling. And Democrats have highlighted weak wage growth as they argue that the economy is not working for many American families.

Article source: https://www.nytimes.com/2020/02/07/business/january-jobs-report.html?emc=rss&partner=rss