January New Jobs Lower than Forecast

February 3, 2005 (PLANSPONSOR.com) - The domestic job creation machine may not have churned out quite as many new jobs in January as economists hoped, but there were actually more new jobs in the five prior months than first reported.

On the up side, the US Department of Labor (DoL) reported in its monthly employment survey that the nation’s January jobless rate dropped from 4.9% in December to 4.7%. The last time it was that low was July 2001.

According to DoL data, theUS labor market grew by 193,000 jobs in January – below the 240,000 predicted by economists polled by Reuters. Among the monthly revisions the government now says 140,000 positions were added in December (compared to the original 108,000). The DoL said 354,000 jobs were created in November (compared to the originally reported 305,000). The revisions were part of its annual adjustment of the data, the DoL said.

The DoL said that January construction employment increased by 46,000; over the year, construction employment has risen by 345,000.  Specialty trade contractors added 28,000 jobs over the month, while residential building and heavy and civil engineering construction added 8,000 each.  Mining continued its upward trend in January, adding 6,000 jobs.  Support activities for mining, particularly those related to oil and gas, accounted for two-thirds of the over-the-month gain.

In the goods-producing sector, manufacturing employment was little changed for the second month in a row.  Within durable goods, employment gains in nonmetallic mineral products (6,000) and primary metals (3,000) were partially offset by a decline in computer and electronic products (-6,000).
In the service-providing sector, employment in health care and social assistance rose by 38,000 in January.  Ambulatory health care services (which includes doctors’ offices and home health care) added 15,000 jobs.  Job growth also occurred in hospitals (7,000) and in nursing and residential care facilities (7,000).  Health care employment increased by 287,000 over the year. Employment in social assistance continued to trend up in January and has grown by 77,000 over the year.
Over the month, financial activities employment was up by 21,000, following little change in December.  Credit intermediation added 11,000 jobs in January, and real estate employment rose by 10,000.
Employment in food services and drinking places grew by 31,000 in January; over the year, this industry has added 214,000 jobs.  In January, wholesale trade employment increased by 15,000.  Employment in retail trade was flat over the month and has shown no net growth since July 2005.
Employment in professional and business services continued to trend up over the month (24,000); the number of jobs in the industry has increased by 515,000 over the year.  In January, computer systems design services gained 7,000 jobs. Temporary help services employment was little changed over the month but has increased by 187,000 over the year.  Following a strong employment increase in December, accounting and bookkeeping services lost 18,000 jobs in January.