WASHINGTON — Hiring jumped last month as U.S. employers added a robust 225,000 jobs, bolstering an economy that faces threats from China’s viral outbreak, an ongoing trade war and struggles at Boeing.
The Labor Department also said Friday that a half-million people streamed into the job market in January, though not all of them found jobs. That influx meant that more people were counted as unemployed, and it boosted the jobless rate to 3.6% from a half-century low of 3.5% in December.
The government’s monthly jobs report signaled that businesses remain confident enough to keep hiring, with the pace of job growth accelerating from a year ago. Solid consumer spending is offsetting drags from the trade war and declining business investment.
The job gains also give President Donald Trump more evidence for his argument that the economy is flourishing under his watch. The Democratic contenders vying to oppose him, who will debate Friday night in New Hampshire, have embraced a counter-argument: That the economy’s benefits are disproportionately benefiting wealthier Americans.
Economists cautioned that a large chunk of January’s job growth reflected temporary increases from unseasonably warm weather. Construction firms, hotels, and restaurants, which benefit from better outdoor conditions, accounted for about one-third of last month’s gains. Still, taken as a whole, Friday’s job growth reflects an economy that shows continued strength 11-plus years into a record-long expansion.
“While favorable weather conditions likely flattered the headline figures in today’s employment report, the key takeaway is that jobs growth continues to run at a solid pace,” said Neil Dutta, head of economics at Renaissance Macro Research.
January’s jobs report doesn’t appear to reflect any economic damage from the coronavirus, which has sickened thousands in China, closed stores and factories there and led many international businesses to suspend operations involving China. The virus’ impact likely came too late in the month to affect Friday’s jobs data.
Nor did Boeing’s decision to halt production of its troubled 737 MAX appear to have much impact on last month’s hiring gain. But the repercussions could begin to restrain job growth in the coming months.
Despite the brisk pace of hiring in January, hourly pay is up just 3.1% from a year earlier, below a peak of 3.5% last summer, though still above the inflation rate.