January Job Gains Below Predictions

Data from the U.S. Department of Labor (DoL) showed that most of the January hiring of 104,000 was in the service sector but manufacturers turned in their seventh consecutive month of job losses. The construction sector had a particularly robust January with 22,000 new jobs – a performance the government said was likely helped along by warmer than usual January weather.

The regular Reuters poll of Wall Street analysts found that they were calling for a 149,000 job increase over the month.

Labor Department officials also announced that January’s unemployment rate inched up to 4.6%, the highest since a matching rate in September of last year.

In addition to releasing the January jobless data, the DoL also said Friday that it had revised its figures for the 12-month period between March 2005 and March 2006 to add a hefty 752,000 jobs the agency had previously not counted.

Examining individual sectors, the government data showed that health care employment was up by 18,000 in January, following a gain of 43,000 in December. In January, employment continued to trend up in hospitals, ambulatory health care, and nursing and residential care facilities. In 2006, health care employment increased by an average of 28,000 a month.
  

Meanwhile, professional and business services employment continued to trend up in January (+25,000), following large advances that averaged 69,000 in the prior two months.  Within this industry, employment in architectural and engineering services rose by 9,000 over the month.
  
Food services employment was up by 21,000 in January. Over the past 12 months, the industry added 347,000 jobs.  Employment continued to expand over the month in transportation and warehousing; the industry has gained 116,000 jobs over the year.
  
Elsewhere in the service-providing sector, employment was essentially unchanged over the month in both wholesale and retail trade. 

Manufacturing employment continued to trend down over the month.  Job losses continued in motor vehicles and parts      (-23,000), in furniture and related products (-4,000), and in textile mills (-4,000).  Computer and peripheral equipment lost 6,000 jobs over the month.  An increase in plastics and rubber employment reflected the return of workers from a strike.  Elsewhere in the goods-producing sector, mining employment was essentially unchanged.