“It may look good, but it ain’t,” wrote Gregory Daco, chief US economist at Oxford Economics, adding that the details of the report were a lot less flattering than the headline numbers.
While the unemployment rate decreased, the labor force participation rate inched down ever so slightly, too, leaving a bad aftertaste following the good news.
“I’d like the unemployment rate go down while the labor force is growing,” said Boston College economics professor Robert Murphy.
Since February last year, the economy is still down 9.9 million jobs.
The January improvements in the labor market weren’t spread evenly across sectors. The leisure and hospitality sector, which is bearing the brunt of job losses in this crisis due to the face-to-face nature of its businesses, lost 61,000 jobs. Over the past two months, nearly 600,000 jobs in the industry were lost.
Retail, health care and transportation and warehousing also saw jobs disappear.
“I don’t see it as a real strong report at all,” Murphy said. “That headline number is not very encouraging. On the private side there was minimal creation.”
Indeed, the private sector as a whole only added 6,000 jobs in January, while the rest of the increase came from jobs added in public education and government.
Trump’s final report card
The January jobs report was based on data collected before President Donald Trump left office, making it the data point that closes the book on Trump’s jobs record.
But even his record for his first 37 months in office wasn’t as strong as Trump often claimed. There were some 6,900 jobs added from January 2017 through February of last year. That’s better than the first 37 months in office for Presidents George W. Bush and Barack Obama, but Obama entered office in the midst of the Great Recession and the economy slipped into another recession shortly after Bush took office. Trump took office during a period of what economists consider full employment.
Trump’s pre-pandemic job gains trailed the gains during the first 37 months of Obama’s second term, or his final 37 months in office. It also trailed gains during the first 37 months of President Bill Clinton’s or Jimmy Carter’s tenure.
