US jobs recovery gets unexpected boost in January

The US jobs recovery got an unexpected boost in January, despite the Ômicron variant rapidly spreading across the country.

The US job market saw 467,000 job creation last month, the Bureau of Labor Statistics said Friday, significantly better than most economists’ forecasts.

The unemployment rate rose to 4%, the first increase in the unemployment rate since June 2021.

Restaurants and bars have created over 100,000 jobs. Jobs in logistics and business services also increased.

Even so, the Ômicron variant left its mark on American workers last month.

The number of people working remotely because of the virus has increased to 15.4%, for example. Likewise, the number of people unemployed for less than five weeks has increased.

As economists’ expectations fell short of reality, the data released on Friday is a reminder that there are many aspects of the economy during the pandemic that make it difficult for economic models to keep up with such an unstable situation.

The majority forecast pointed to just 150,000 jobs. Many economists even expected job losses, warning that business closures and worker absenteeism in jobs without sick leave could lead to people being counted as unemployed.

A similar dynamic played out last winter, when rising infections temporarily weighed on the job recovery in December 2020.

Furthermore, America is still in the midst of a labor shortage. In December, the country had 10.9 million jobs open.

Even so, the Omicron variant left its mark on American workers last month. The number of people working remotely due to the virus has increased to 15.4%, for example.

A total of 6 million people said they worked fewer hours or didn’t work because their employer closed or lost business due to the pandemic. The number of people unemployed for less than five weeks has also increased.

The average number of hours worked also declined, “showing that the impact of the pandemic is still here as more workers have had to cut hours due to illness, quarantine or family obligations,” said Glassdoor senior economist Daniel Zhao.

The unemployment rate rose to 4%, the first increase in the unemployment rate since June 2021.

Recovery on the track

Despite all this, the January report insisted that the jobs recovery is still on track.

For President Joe Biden, that’s a good bulletin: the economy created 6.6 million jobs during his first 12 months in office, making it the best first year for a president.

Meanwhile, revisions to BLS data showed that winter job gains were much stronger than previously expected: between November and December, the number of jobs added was more than 700,000 jobs higher than initially reported.

Similarly, job gains were also stronger in January and February 2021.

But during the northern hemisphere summer, the revisions did the opposite. The job change for June and July was more than 800,000 positions lower than previously reported.