January Payrolls Expanded 517,000, Jobless Rate Eased to 53-year Low

Brian Turner
03 Feb, 2023
New York City

The U.S. economy added 517,000 net new jobs in January, the strongest gains since July 2020, the Bureau of Labor Statistics reported Friday. 

Net job additions in the non-farm payrolls were not expected to rise above 175,000 according to several economists and surpassed December's 260,000 net gains. 

In a widespread job addition, the leisure and hospitality industry led the expansion with an addition of 128,000 followed by 82,000 gains in professional and business services, 58,000 in healthcare, 30,000 in retail trade and 25,000 in construction. 

Governments at all levels also added 74,000 net new jobs, partially reflecting the return of 48,000 academic workers at the University of California.   

The January report offers critical insight in the labor market as several large tech companies announce substantial layoffs as companies recalibrate business outlook and prepare for economic slowdown. 

January job gains were ahead of the monthly average of 401,000 in 2022. 

Both the unemployment rate, at 3.4%, and the number of unemployed persons, at 5.7 million, changed little in January. 

The unemployment rate has shown little net movement since early 2022  and dropped to the lowest level since 1969. 

Labor force participation rate edged higher to 62.4%, but still below the pre-pandemic level of 63.6%. 

Wages rose 0.3% in January from the previous month and eased to 4.4% pace from a year ago from 4.6% in December.  

In January, average hourly earnings for all employees on private nonfarm payrolls rose 10 cents, or 0.3%, to $33.03, an increase of 4.4% from a year ago. 

In January, average hourly earnings of private sector production and nonsupervisory employees rose 7 cents or 0.2% to $28.26.

Jobs gains in November and December were revised higher by a total of 71,000, the report from the Labor Department noted.  

The government agency also revised higher total jobs added over 12 months to March by 568,000, based on more complete tax-records and reflecting annual revision.