Economy Adds 257,000 New Jobs; Unemployment Rate Up Slightly

By Scott Neuman / NPR

Published February 6, 2015 at 3:10 AM PST

This story was published more than 9 years ago.

A construction worker looks down on the site of the Manhattan West project, last month in New York. Construction was among the hardest-hit sectors during the worst recession in modern memory.

Updated at 9:10 a.m. ET

Some 257,000 jobs were added to the U.S. economy in January, continuing a 12-month-span of 200,000+ growth, according to the Department of Labor. Even so, in a separate survey released by the department's Bureau of Labor Statistics, the benchmark unemployment rate ticked up slightly to 5.7 percent.

The data exceeded the consensus forecast of economists, who looked for a slight slowing of growth from December. They forecast 230,000 new non-farm payroll jobs and an unemployment rate holding steady.

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The healthy gains were in sharp contrast to six years ago, in January 2009, when the economy shed nearly 800,000 jobs in the depths of the Great Recession. In the first quarter of 2009, a whopping 2.3 million jobs were lost.

As we reported last month, unemployment rate had dipped from 5.8 percent to 5.6 percent, while the economy added 252,000 jobs in December, according to initial reports.

January's slight rise in the unemployment rate from its 5.6 percent figure last month is explained by a 703,000 increase in the civilian labor force — amounting to a 0.2 percentage point rise in the labor force participation rate.

The month's data was also accompanied by a significant positive revision in the the November and December data. The revision pegs November's job gains at 423,000 from the 353,000 initially reported. Likewise, the December number was revised upward to 329,000 new jobs.

The Bureau of Labor Statistics says the biggest job gains occurred in construction (+39,000), health care (+38,000) abd financial activities (+26,000). The manufacturing sector added 22,000 jobs.

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CNBC reports that it is only the second time in the last 11 years that January's numbers beat Wall Street expectations.

The Wall Street Journal reports:

"The report suggested employers maintained enough confidence to keep expanding in 2015 following the best year of job growth during the current expansion. "The rise in workers' earnings offered a sign that slack in the labor market is diminishing. Average hourly earnings among private-sector workers rose 12 cents to $24.75 and were up 2.2% from a year earlier."

However, some offered up a note of caution on the good news. Jim O'Sullivan, chief U.S. economists at High Frequency Economics said in a note to clients early Friday to "Be wary of January payroll data.

"While the data are noisy in general, limiting the information value of a single reading, the seasonal adjustment process is especially challenging in January," O'Sullivan wrote, according to The New York Times.

Even so, the unemployment rate remains stubbornly high for some groups of individuals: for teenagers, it is 18.8 percent.

The rate for adult women was slightly better than for adult men (5.1 percent and 5.3 percent, respectively). The rate for whites was 4.9 percent and 4.0 percent for Asians. The rate for blacks was 10.3 percent and 6.7 percent for Hispanics.