Job creation surged in the US economy in January

Job creation surged in the US economy in January while the unemployment rate drifted marginally higher as more people joined the job hunt, the Labor Department reported Friday.

With hiring up in retail, construction and the financial sector, the economy added 227,000 net new nonfarm jobs in the month, the biggest jump since September.

The jobless rate ticked up a tenth of a point to 4.8 percent, reflecting a small increase in the labor force.

The result far surpassed a consensus forecast for 170,000 new positions, although economists were warning in recent days there could be a big upside surprise based on other recent labor indicators.

The new figures, which include the first 11 days of Donald Trump’s presidency, largely confirm the health of the economy he inherited, which has seen a slow but steady recovery from the 2008 financial crisis.

Revisions to the November and December data, which subtracted 39,000 from the originally reported figures, meant the economy created an average of 183,000 new jobs over the past three months.

Trump — who on the campaign trail repeatedly impugned the trustworthiness of the unemployment data — has pledged to create 25 million jobs over the next 10 years, a goal economists say is unrealistic given that the economy already is near full employment and due to the aging work force.

The labor force participation rate rose 0.2 point to 62.9 percent, indicating more people returned to the work force to search for a job.

Average hourly earnings were $26.00 an hour, up a very modest three cents from December. Wages are up 2.5 percent over the last 12 months.

The US Federal Reserve this week decided to keep interest rates steady, but as the economy heats up and especially if wages continue to rise, the central bank will feel more pressure to raise the benchmark federal funds rate to clamp down on inflation.

Retailers, including clothing, electronics and furniture stores, added 46,000 positions for the month while construction added 36,000 new positions.

Financial activities accounted for 32,000 new positions, with gains recorded in real estate, insurance and credit intermediation. Restaurants and bars also continued their upward trend, adding 30,000 new positions.

The mining and manufacturing, which have both suffered losses in recent months, showed little or no change.

The general picture of unemployment was largely unchanged, however. The so-called long-term unemployed, or those looking for work for 27 weeks or more, numbered 1.9 million, about a quarter of the total jobless population 7.6 million.

Discouraged workers, or those who believe that no jobs are available, amounted to 532,000 people in January, a figure which was little changed from a year ago.

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