The job growth in the United States increased firmly in the month of January and wages rebounded, signaling strengthening of economy that raises the possibility of a mid-year interest rate hike by the Federal Reserve back.
The nonfarm payrolls rose 257,000 in January while outstripping the forecasts of Wall Street, according to the Labor Department report released on Friday.
At the same time, jobs data for the months of November and December was revised to show a surprising 147,000 more employment created than earlier reported, reinforcing the consumers’ views will have enough muscle for carrying the economy through the coarse global seas.
Sung Won Sohn, an economics professor at California State University Channel Islands in Camarillo, said, “A mid-year lift-off in the interest rate is fait accompli … there was good news on many fronts.”
The November’s gain of 423,000 jobs was the largest recorded for any month since May 2010, when the employment was recorded by hiring by the government for a national census.
Over one million employment opportunities have been created over the past three months, which is the first time ever the milestone mark has been reached since late 1997.
The rate of unemployment jumped 5.7 percent, i.e. one-tenth of a percentage point, as the Americans poured into the labor market hunting for jobs in a show of risen confidence.
Chris Low, chief economist at New York-based FTN Financial, said, “Hundreds of thousands of discouraged workers were optimistic enough to start looking for work in January. Most Fed officials are likely to see this report as good reason to be nervous about potential economic overheating.”
The month of January marked the 11th consecutive month of gains in the job market above 200,000, the longest line since 1994.
The wages surged 12 cents in January, which is the largest gain since June 2007 following declining five cents in December. This took year-on-year addition to 2.2 percent, which is the fastest gain since August last year. Whatever be the case, it is still below the expectation of Fed officials.
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