January 2021 US non-farm payrolls data:
- Prior was -140K (revised to -227K)
- Unemployment rate 6.3% vs 6.7% expected
- Prior unemployment rate 6.7%
- Participation rate 61.4% vs 61.5% expected (was 62.8% pre-pandemic)
- Prior participation rate 61.5%
- Underemployment rate 11.1% vs 11.7% prior
- Average hourly earnings +0.2% m/m vs +0.3% expected
- Average hourly earnings +5.4% y/y vs +5.0% expected
- Average weekly hours 35.0 vs 34.7 expected
- Two month net revision -159K
- Change in private payrolls +6K vs +163K expected
- Change in manufacturing payrolls -10K vs +30K expected
- Long-term unemployed (those jobless for 27 weeks or more), at 4.0 million, was about unchanged in January and accounted for 39.5% of the total unemployed
- The employment-population ratio, at 57.5% in January, changed little over the month but is 3.6 percentage points lower than in February
- Job losses led by leisure and hospitality, in retail trade, in health care, and in transportation and warehousing
- Full report
The way to square the drop in the unemployment rate with the other numbers is with the annual adjustments that were included in this report. Participation only dropped 0.1 pp and jobs were lost on the headline and the revisions. About 400K people left the labor force.
The US has 9.8m fewer jobs than it did in February 2020 and to keep up with population trends, 12m would have to be added
The dollar is slumping on these headlines but there's a good argument that they make stimulus more likely.