US Sees Surprise Hiring Surge As Unemployment Edges Down

US job gains surged unexpectedly last month as unemployment slipped to its lowest rate in more than five decades, government data showed Friday, indicating strength in the labor market despite efforts to ease economic activity

Washington, (APP - UrduPoint / Pakistan Point News - 3rd Feb, 2023 ):US job gains surged unexpectedly last month as unemployment slipped to its lowest rate in more than five decades, government data showed Friday, indicating strength in the labor market despite efforts to ease economic activity.

This could prove concerning to policymakers, with risks that elevated wages could feed into inflation.

While the US central bank has tempered its aggressive campaign to rein in prices on signs that the world's biggest economy is cooling, the latest figures could steer it towards more interest rate hikes than expected.

The United States defied expectations to add 517,000 jobs in January, nearly double the December figure, after a five-month slowdown in hiring, said the Labor Department on Friday.

"Job growth was widespread, led by gains in leisure and hospitality, professional and business services, and health care," the report added.

Employment in manufacturing and construction showed resilience as well, despite a slowdown in activity in both sectors.

The jobless rate edged down to 3.4 percent, a level last seen in 1969, according to government figures.

But wage growth slowed slightly with average hourly earnings rising by 0.3 percent to $33.03, down from December's 0.4 percent increase.

Taken together, these figures suggest the labor market remains too hot for policymakers, with the hiring figure marking a spike from December's 260,000 number.

US President Joe Biden on Friday cheered the strong job creation since he took office and noted that inflation was still cooling off. He pushed back against critics who, he says, suggest that "the only way to slow down inflation was to destroy jobs.""Today's data makes crystal clear... these critics and cynics are wrong," he told reporters, though conceding there remains more work to do.