National employment, January 2021

The unemployment rate fell in January 2021, but job growth was weak, and the December value was revised.

The Bureau of Labor Statistics, part of the United States Department of Labor, reported the closely-followed jobs number rose in January 2021 by 49,000 jobs from the prior month. The unemployment rate fell from 6.7 percent to 6.4 percent. BLS notes that the total nonfarm employment level is “below its February 2020 level by 9.9 million, or 6.5 percent.”

The summary report from BLS may be found here.

Of note: BLS revised recent figures, which it does as more data becomes available. After the revision, the job loss in December is 227,000 instead of the previously reported 140,000

In its reporting, the Wall Street Journal wrote, “The unemployment rate decline in January was driven by two factors. More people dropped out of the labor force—meaning they weren’t actively looking for a job and may have grown frustrated with their employment prospects. Also, the number of people reporting themselves as employed increased, consistent with a generally upward trend in hiring since last spring.”

It added: The broader economic recovery stalled significantly this winter. Unemployment claims, a proxy for layoffs, have remained above pre-pandemic levels. Consumers cut back on spending, as some were wary of leaving their homes as virus cases surged. Others wanted to shop and dine out, but had limited options. … Economists see the winter lull as temporary. They expect growth to pick up later this year as more people get vaccinated and business restrictions further ease. Many economists also say the economy could benefit from further government stimulus.” See U.S. Employers Added 49,000 Jobs in January, Growth returned to the labor market after one-month dip; unemployment rate fell to 6.3%.

Axios reported: “Driving the news: The economy ended the Trump years with an unemployment rate of 6.3%. That’s a lot lower than the pandemic-induced high point of 14.8% in April, but still well above the 4.7% unemployment that Barack Obama left behind. Why it matters: Former President Trump inherited a flourishing labor market. He’s handing President Biden one that has a ways to go before recovering from an unprecedented shock. … By the numbers: When Trump took office, the economy had 145.6 million jobs. The legacy he leaves Biden, as measured during the week of Jan. 11: 3 million fewer jobs, and a labor force of 160 million people that’s 4.5 million people smaller than it was four years ago.” See The Trump-COVID jobs legacy.

In an opinion piece in the Washington Post, Catherine Rampell wrote: “Well, at least we didn’t lose jobs last month, as was the case in December. But job growth in January — at an anemic 49,000 net payroll jobs — was still much slower than it was pre-pandemic. Which doesn’t do much to help us recover the 22 million jobs lost in early spring.

As a result, we’re still deep in the hole. The jobs deficit today remains greater than it was at even the worst point of the Great Recession: … But the most important thing the feds can do to get the economy back up and running — and prevent the permanent departure of these workers from the labor force — would be to curb the spread of the coronavirus. That means encouraging mask-wearing and other low-cost adaptations, and especially ramping up vaccinations. We’re now averaging more than 1 million vaccinations per day nationwide; surely we can bump that up higher.” See Opinion: More covid relief is urgent. January’s jobs report shows where the need is greatest..

My interactive visualization is updated with this data and is available here.

Example from the visualization. Click for larger.

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