January Hiring Falls Short of Projections, Weather Limited Market Progress
With very cold weather acting as a factor in limiting the progress of the U.S. job market, companies hired fewer workers in January than was projected. The increase of 175,000 workers was the smallest in five months after a revised 227,000 new workers in December, which was also lower than expected. The median projects by economist surveyed by Bloomberg for January was 185,000. As cold and snowy weather kept shoppers from shops and car dealerships, businesses reduced hiring in response.
In the manufacturing sector, builders and goods-producing industries hired 16,000 new employees and employment in construction increased by 25,000. Factories lost 12,000 jobs as employment in the manufacturing industry shrank for the first time since July 2013. Service providers hired 160,000 workers as professional and business services contributed the most to the growth of all service industries. The extreme cold during January, the coldest since 1994, hurt demand for motor vehicles, which has been a primary driver of the economic expansion.
The median forecast of economists predicts that businesses added 188,000 employees in January, up from 87,000 in December, while overall payrolls, including government agencies, may have risen by 184,000 workers, up from 74,000 in December. The unemployment rate is holding at 6.7 percent, the lowest since October 2008.