Coming off what some had coined the greatest employment report ever, it was likely the first read on jobs, income, and wages in 2020 would have a high threshold to impress. It’s safe to say it didn’t but that doesn’t mean that there isn’t plenty of terrific news inside of the report. As always, it’s important to take a look past the headlines to find the real storylines. That’s especially true in this month’s report. There’s a huge storyline waiting to be told but first, we will start with the headline stuff.
The unemployment rate came in at 3.5%, we added over 145,000 jobs and had negative revisions from previous months totaling -14,000 jobs. The top industries for hiring were retail, leisure and hospitality and healthcare.
It's important to note that factoring in the revisions, the real number was +131,000 jobs added. Plus, retail and hospitality related gains to end 2019 show the true strength of consumer spending, a leading indicator for the US economy as it accounts for about 70% of all economic growth.
Now, the real unemployment rate once underemployed, long-term unemployed and marginally attached people are accounted for came in at 6.7% that's down from 7.6% in 2018.
The key takeaways include that the real unemployment rate is now at a record low! That’s right, the unemployment rate that accounts for every American, not just those captured by basic government readings, has never been lower in American history. Plus, those unaccounted for in the base unemployment rate include 6.5 million Americans. This was an improvement of 200,000 jobs in December and helps illustrate the difference between the ADP private-sector report which looked terrific for December and the government report which on the surface looked just OK. Finally, the labor participation rate continues to improve year over year with more people joining the workforce with an unprecedented opportunity.
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