There is no shortage of economic and earnings data this
morning, but the focus remains on the labor market with the
January non-farm payroll report. The jobs numbers were a tad bit
lighter than expected, but the revisions to the prior two months
makes the labor market picture somewhat better.
Also on tap for release a later are the January manufacturing ISM
Index and the final University of Michigan Sentiment Survey for
January. And let's not forget about the fourth quarter earnings
season that brought us positive-looking numbers from
) this morning, though
) outlook doesn't look that reassuring.
The 'headline' January jobs numbers of 157K were modestly shy of
expectations of 165K. The consensus estimate did not rise much
following the strong report from ADP on Wednesday, but many of us
were still looking for a bigger number this morning. The saving
grace came from revisions, which was decidedly on the positive
The December tally was revised to 196K from 155K, while the
November was revised higher to 247K from the 161K originally
reported. The unemployment rate ticked up to 7.9% from 7.8%. The
average work week remained unchanged, while average hourly
earnings increased 0.2%. The labor force participation rate
remained unchanged at 63.6% in January.
??????Private sector jobs totaled 166K in December,
significantly below December's 202K level (December's tally was
revised higher from 168K) and November's 256K level
(revised upwards from 171K). The January gains were concentrated
in retail, construction, and healthcare. Jobs in the retail
sector increased by 33K in December, compared to the 2012 monthly
rate of 20K.
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Construction jobs increased by 28K in January, with most of the
gains coming from specialty trade contractors. To put the
momentum in this key sector in context, roughly one third of the
296K construction jobs added since January 2011 have occurred in
the last four months. Healthcare added 23K in January, adding
320K jobs in 2012. Manufacturing jobs were essentially unchanged
in January, having changed little since the middle of 2012.
Today's report shows that the average monthly jobs tally has been
fairly stable in the last two years, though the revisions have
helped improve the monthly tally for 2012 a bit. Importantly, the
revisions show that negative backdrop of 'Fiscal Cliff'-related
uncertainty has not had much of a dampening effect on hiring
Given the historical uncertainty associated with the January
data, one could safely assume that today's numbers will most
likely revised higher in the coming months. Hard tell though
whether that is good enough at this stage to put the market back
on its upward trajectory. It's definitely not bad.