By Isaac Cohen*
Defying all predictions, last month the US labor market grew vigorously. The Labor Department informed that in January employers hired 517,000 new workers, the largest increase since last July. The unemployment rate decreased to 3.4 percent, from 3.5 percent in December, the lowest in more than 50 years. Hourly earnings increased 0.3 percent since December and 4.4 percent since last year, still below the inflation rate of around 6 percent.
On the same day, from Philadelphia, President Joseph Biden emphasized the good news, complementing employers for creating 12 million new jobs since he took office, adding this is “the strongest two years of job growth in history.”
Except in information and finance, where 5,000 jobs were lost due to layoffs at Amazon, Google, Microsoft and Goldman Sachs, most hiring increases were in the services sector. For instance, the most vigorous hiring was in leisure and hospitality with 128,000, health care 58,000 and even construction added 25,000 new jobs. Some of these sectors employ minorities, which contributed to shorten the distance between the unemployment rates of African Americans and Hispanics, at 5.4 and 4.5 percent, respectively.
Tightness in the labor market was evident because last December there were 11 million job openings, while around 5 million unemployed persons were looking for work. All stock indexes ended lower after the December employment report, interpreting that the central bank will continue increasing interest rates at its next meeting of March 21-22.
*International analyst and consultant, former Director ECLAC Washington. Commentator on economic and financial issues for CNN en Español TV and radio, UNIVISION, TELEMUNDO and other media.