February 4, 2013 in U.S.
Total non-farm employment in the U.S.A during the month of January was better by 157,000 jobs, as reported by the Bureau of Labor Statistics.
Significantly, most of that growth was contributed by private employers (+166,000) whereas government employment (-9,000) fell. (See the above charts for the trend).
The Bureau also revised the NFP change in the months of November and December by 86,000 and 41,000 respectively. The positive job number change in these months therefore now stands at +247,000 and +196,000; in comparison, the January change of +157,000 points to a slowdown in job creation.
Along with the tepid GDP growth figure released recently, this makes for worrisome reading.
It is also a given that debt ceiling concerns and commitments made during the fiscal cliff horse-trading will result in further slowdown in governmental job creation. But will the private sector be able to compensate this?
It might be worthwhile to look at the composition of the job growth in January.
Sectors that contributed to job growth
We note that the following sectors were the chief contributors to the addition of 157,000 jobs in the last month:
- Retail Trade +32,600
- Construction +28,000
- Education & Health +25,000
- Services +25,000
The addition of 32,600 jobs in the Retail Trade segment was contributed mainly by Automobile Dealers (as fallout of the strong trend in auto sales), Food and Beverage stores and Clothing and Accessories stores.
The Construction sector saw better hiring by the Specialty Trade Sectors (+26,000) during the month. This logically follows better conditions in the housing market.
The ambulatory health care services (comprising chiefly physicians’ offices and outpatient care centers) were the main creators of jobs in the Healthcare industry.
The job losers
The major losers were Transportation (-14,200) and Government (-9,000).
Job losses in Transportation were chiefly due to restructuring among airlines and layoffs amongst Couriers after strong hiring in the holiday season.
Losses in Government jobs are a part of a downward trend in public employment since the financial crisis, and may exacerbate done the line as further budgetary restrictions take force.
Though the last three months have seen a slowdown in the rate of jobs creation, we note that economically significant sectors such as retail trade, healthcare and construction continue to add jobs. An improvement in the fortunes of the manufacturing sector could boost jobs growth, and finally make a dent in the unemployment rate which continues to hover around 8%.