The U.S. economy added 243,000 jobs in January, more than in December even as the impact of temporary holiday hiring came out of the measure, and the best reading in several years. Unemployment was down again, to 8.3%.
Friday morning’s figure from the Labor Department’s Bureau of Labor Statistics was well ahead of estimates calling for job gains to slow to somewhere around 140,000.
Private sector payrolls jumped 257,000, more than expected and well above the 170,000 the figure from the monthly employment survey from Automatic Data Processing released Wednesday.
On a sector basis, Friday’s reading showed the biggest gains in professional and business services, which added 70,000 jobs in January.
The average workweek for all employees was unchanged, but for manufacturing workers the average week increased 0.3 hours to 40.9 hours and factory overtime increased by a hair. Average hourly earnings rose 4 cents, or 0.2% to $23.29
January’s solid jobs gain comes after revisions to November and December payrolls added a total of 50,000 jobs to those two months. Unemployment’s dip to 8.3% was from 8.5% a month ago and the reduction in the U.S. workforce in January — 1.2 million people, which brought the civilian labor force to a new 30-year low of 63.7% — was a factor in the decrease. (See “U.S. Adds 200K Jobs In December, Unemployment 8.5%.”)
The major U.S. stock averages showed modest gains ahead of Friday morning’s report, then erupted for big gains after the solid figure. Futures signaled a triple-digit gain for the Dow Jones industrial average with about 50 minutes to the opening bell, along with strong starting gains for the S&P 500 and Nasdaq.
The gains sparked by Friday’s employment reading, the latest signal of an improving U.S. economy, were broad-based. Economically-sensitive stocks were among the leaders though; Bank of America jumped 3.1% in the pre-market session while fellow Dow component General Electric, a conglomerate with businesses that operate throughout the U.S. economy and around the world, gained 1.3%.
Update 9:35 a.m.: The major indexes raced out of the gate Friday morning. Five minutes into the session the Dow jumped 110 points to 12,816, the S&P 500 added 13 points to 1,338 and the Nasdaq was up 28 points to 2,887, its best levels in more than a decade.
Update 1:10 p.m.: More than halfway through the trading day, the Dow was up 152 points to 12,858, the S&P 500 was up almost 18 points to 1,343, and the Nasdaq was up 46 points to 2,905.