America's employers added a robust 517,000 jobs in January, a surprisingly strong gain in the face of the Federal Reserve's aggressive drive to slow growth and tame inflation with higher interest rates.
WASHINGTON -- For nearly a year, the Federal Reserve has been on a mission to cool down the job market to help curb the nation's worst inflation bout in four decades. Consider what happened in January: The government said Friday that employers added 517,000 jobs last month and that the unemployment rate dipped to 3.4%, the lowest level since 1969.
by signing up you agree to our terms of service On top of the sizzling job growth it reported for January, the government on Friday also revised up its estimate of the gains in November and December by a combined 71,000.
"This is a labor market on heat,'' said Seema Shah, chief global strategist at Principal Asset Management. It would be difficult, she suggested,"to see the Fed stop raising rates and entertain ideas of rate cuts when there is such explosive economic news coming in." But year-over-year measures of consumer inflation have steadily eased since peaking at 9.1% in June. At 6.5% in December, though, inflation remains far above the Fed's 2% target, which is why the central bank's policymakers have reiterated their intent to keep raising borrowing rates for at least a few more months.
But the job market's resilience isn't making that hoped-for outcome any easier. On Wednesday, the Labor Department reported that employers posted 11 million job openings in December, an unexpected jump from 10.4 million in November and the largest number since July. There are now about two job vacancies, on average, for every unemployed American.Stew Leonard Jr.
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