U.S. Job Data Not Positive Enough, According to Analysts

U.S. Job Data Not Positive Enough, According to Analysts
U.S. Job Data Not Positive Enough, According to Analysts


U.S. Job Data Not Positive Enough, According to Analysts

Though the U.S. Federal Reserve decided earlier to taper its budget stimulus expecting the better employment data, it looks like the expectations were not based on the right signals. Now that the data is out, the U.S. is concerned about weak job growth. Some market analysts believe that the weak employment data may dampen the vigor displayed by the American economy late last year.

According to the data released by the Labor Department, monthly employment report shows a tepid gain of 113,000 jobs in January followed December’s puny increase of 75,000. However, it is far below last year’s average monthly gain of 194,000. The best part from the latest data is that more Americans are now looking for jobs.

Despite Low Turnout, Analysts Expect Better Employment down the Year

When the employment data came from the Labor Department on Friday a lot of analysts felt that they show signs of a possibly softening economy. Also, a survey shows that manufacturing firms have gone slow as expansion slowed last month. Nonetheless, the jobs report offered some hints that hiring could return to last year’s healthier levels in the coming months.

The best part, however, is that the unemployment rate is at its lowest point since October 2008, the time when the financial crisis was around the corner. Also, there has been an improvement in the rate which fell because many of the unemployed found work. Nevertheless, another positive sign is that manufacturers, construction firms and mines added a combined 76,000 jobs last month.


This number is the most since January 2006 and sending positive signals in employment data and decision makers at the Federal Reserve. Market observers believe that this number tells that the manufacturing sector hires new people only when it feels that the overall economy is going to do better in the coming years.

Though the Federal Reserve is expecting for a better economy this year and for that reason it cut stimulus, the data and its intricacies signal the assumption as it is rare to see that these industries hire without the economy being in fairly healthy shape. There are also positive indications on home sales and the construction sector.

Nonetheless, the report on the employment in the U.S. has provided some cause for optimism and some cause for concern. Whereas solid hiring last month in manufacturing and construction point to underlying strength, the numbers fell from what they were earlier expected.

To contact the reporter of this story: Jonathan Millet at john@forexminute.com