The Department of Labor’s Bureau of Labor Statistics (BLS) confirmed the robust employment numbers reported by ADP/Moody’s on Wednesday: 235,000 new jobs were created in President Donald Trump’s first full month in office, with the unemployment rate dropping further, to 4.7 percent. Just as reported by ADP, the BLS report showed strong growth in construction, manufacturing, and mining, representing nearly a third of the jobs created in January.
Friday’s report also exceeded Wall Street economists’ expectations, which had ramped up following the ADP report. And both reports clearly indicate more than just a blip, with the first two months’ employment numbers averaging well above former President Obama’s last year in office at just 188,000 new jobs per month.
Unnoticed by most were where the people were coming from to take those new jobs. Long-term unemployment “was essentially unchanged” month-over-month, according to the BLS, as were those working part-time “for economic reasons.” Those “marginally attached to the labor force” (i.e., those not in the labor force who were available for work and had looked for work in the last 12 months), also remained constant.
So where are the new workers coming from? One of Obama’s hangovers was the number of people who left the workforce altogether during the slowest economic recovery in recent history. At its peak, nearly 96 million weren’t working but could work given enough incentive. In December, according to the BLS, that exact number was 95.1 million. In February that number had dropped to 94.2 million. Say it right: 900,000 Americans have entered the workforce since the end of December!
And the incentive: the increase in hourly wages (according to the Economic Policy Institute) of more than three percent last year. That uptick has made working a more attractive alternative to many who otherwise would be sitting at home receiving unemployment checks and using up whatever savings they might have left.
The positive economic outlook as measured by the University of Michigan’s consumer sentiment surveys, reported by The New American on Wednesday, was reflected by Americans buying homes in January at the fastest rate in a decade, despite higher mortgage rates. It’s no wonder that new jobs in construction jumped in January and February. Wait until the weather warms up and people begin home shopping in earnest!
In addition, factory output has recovered from an 18-month-long slump, adding fuel to the employment fire as well.
The best news is not just that the BLS jobs report confirmed ADP’s findings, but it also virtually eliminated any suggestion that Wednesday’s report was an aberration, an anomaly or a “blip” on the screen. It also is a harbinger for President Trump’s goal of adding 25 million jobs to the American economy over the next 10 years. So far, according to both ADP and the BLS, he’s right on schedule.
An Ivy League graduate and former investment advisor, Bob is a regular contributor to The New American magazine and blogs frequently at LightFromTheRight.com, primarily on economics and politics. He can be reached at email@example.com.