The government shutdown was no speed bump, at least, according to the latest job numbers. Data released on Friday (Feb. 1) morning found that job growth, as measured in January, sent nonfarm payrolls up by as many as 304,000 positions. That growth trounced estimates of 170,000 jobs created.
The numbers, released by the U.S. Department of Labor (DOL), showed that even with a partial government shutdown, growth marked the period and the unemployment rate stood at 4 percent. As reported by CNBC, job growth has now marked its 100th month in a row, currently the longest stretch of creation on record.
Yet, there was at least some downward revision to other numbers: December’s previously reported gain of 312,000 positions was reduced to 222,000 net additions. These latest numbers come after an average monthly gain of 223,000, seen throughout 2018.
As seen in previous reports, wage growth was a bit more tempered, as average hourly earnings were up just three pennies in January, representing a gain of 10 basis points compared with December of last year. The average wage reading still shows growth of more than 3.2 percent, continuing a trend.
The latest data also showed that services positions were up by 224,000, and that leisure and hospitality, as a vertical, saw positions grow by 74,000, with construction up by 52,000 positions.
As to whether the job gains and the light wage growth keep translating into consumer spending, that remains to be seen. It should be noted, however, that wage growth can be viewed, traditionally, as an input that can translate into price hikes and, thus, inflation.
When it comes to inflation, interest rate hikes — which make debt more expensive to carry, and may curtail spending — seem to be on pause (at least, for now). As noted earlier in the week, Federal Reserve Chairman Jerome Powell said economic growth is continuing, and that “the case for raising rates has weakened somewhat.” The Fed has left its benchmark rates unchanged thus far in 2019.