Imagine. You’re expecting a new bike for Christmas, but you come downstairs to find under your Christmas tree a … fob for a new SUV! That’s what we who observe and advise on the job market feel like today.
The Bureau of Labor Statistics released their January Jobs Report and it was by every measure an absolute blockbuster: 517,000 jobs created, blowing away most expectations of “experts” who were all figuring we’d see growth of 180K jobs or so. And if the 517K isn’t enough for the few skeptics left in captivity, job growth for November and December were adjusted upward by a combined 70,000. The “experts” also pretty much agreed that the unemployment rate, at a 50-year low of 3.5%, would likely tick up to 3.6%, (which wouldn’t have been such a disaster). It didn’t. It dipped further to 3.4%, lowest since 1969 and not bettered until we go back to October 1953. This becomes even more astonishing in the face of 86,000 tech sector layoffs in January (Source: layoffs.fyi).
While all this was going on, although average earnings growth rate slowed slightly, it did, however, rise by 0.3%, and 4.4% year over year.
Never anything like it
In 25 years as an independent career coach and job market observer, I’ve never seen anything like this. For the 25th consecutive month, the American job market is the star of the show. Without doubt, it is carrying the entire economy on its shoulders, rather than the other way around. In fact, the job market is the single biggest reason we haven’t moved toward or into recession.
It bears repeating that the American job market has been through the roughest seas that any of us who are still in the market can remember: Covid, climate crisis, supply chain clogs, war in Ukraine, chip shortages, political turmoil (crazier than ever mid-term shenanigans), Congressional craziness in the selection process of Speaker, cryptocurrency upheavals, inflation, looming recession (although forcefully pushed back by the continuing good performance of the job market), stock market volatility, and so on.
Job creation consecutive game hitting streak
Last year finished out with 4.818 million new jobs, on the heels of 2021’s record-smashing 6.743 million, taking its place as #2 in history. So what does January 2023 do? Blow the doors off and keep the consecutive game hitting streak going.
But there’s so much more to the job market. Such as…
Where were the jobs?
Job creation was exceptionally widespread: 128K in leisure and hospitality, 82K in professional and business services, 74K in government, 58K in healthcare, 30K in retail, 25K in construction, 23K in transportation and warehousing, 21K in social assistance, and 19K in manufacturing. Remaining sectors showed little change. In baseball terms, everyone in the lineup is hitting once again.
Under the surface
Here’s some lesser-known data showing how solid our job market is. First, there are 11,012 million open jobs, a ratio of 1.92 open jobs to every one of the 5.722 million unemployed job seekers. Notable is that the open jobs number continues to rise while the number of unemployed keeps falling.
Other strong trends: the civilian noninstitutional population grew by 1.12 million last month and the civilian labor force grew by 866K. Those are not merely jumps; they’re surges, and it takes robust job creation to meet the optimism of all those people entering or re-entering the got job market. That’s exactly what the job market delivered. It appears that 78% of the people who entered the workplace last month got jobs. Their optimism was not only justified, it was requited.
Not done yet. When a performance like this takes place, open jobs tend to close by being filled. This time? Open jobs jumped from 10,440 to 11,012.
From my professional vantage point, I was expecting a bike (a bright, shiny one, for sure) but I got a beautiful SUV.
Courtesy of the American job market.
