Manufacturing Jobs

The U.S. economy produced 225,000 new jobs in January although the continued loss of manufacturing positions suggests American product manufactures aren’t entirely free from concern after an uninspiring end to 2019.

Health care and social assistance job creation nearly doubled from December through January, because the industry included over 47,000 of last month’s gains after introducing just 25,000 the month before, based on the latest employment report published through the Bureau of Labor Statistics.

The increase strongly supports that despite the uncertain political arena of an election year, businesses continue to be positive about 2020’s economic projections.

January’s 225,000 new jobs exceed analysts’ expectations of 160,000. But financial activities, retail trade and temporary health services occupations all contracted a few weeks ago, as did other manufacturing industries that spent a lot of a year ago in recession.

Other reliable manufacturing reports suggest industrial activity recovered recently, but we estimate these industries will eliminate 12,000 positions after dropping 5,000 in December. Continued manufacturing slowdown, specifically in politically charged states for the 2020 presidential election, for example Pennsylvania, Michigan and Wisconsin could be challenging for President Trump’s reelection bid, given his administrations target invigorating the industry.

Today’s objective labor market data show a stable but much calmer economy than the one described by President Trump this week during State of the Union address. “Rather than a ‘blue-collar boom,’ the United States is still in a manufacturing recession with manufacturing losing another 12,000 jobs this month.

The unemployment rate increased to 3.6% a few weeks ago, though that’s partly due to the results of the labor workforce increasing to 63.4%. Unemployment increased as more Americans who were not actively trying to find work jumped back into the workforce.

It’s clear that many employment opportunities are encouraging more people to enter, or in some cases re-enter, the job market.

Aside from Manufacturing, much of Friday’s employment report were encouraging. Average hourly earnings increased at an annual rate of 3.1%, outperforming inflation and serving as an advantage to U.S. consumers. Revisions to job improvements in November and December added 7,000 previously unrecorded positions.

The Bureau of Labor Statistics had previously announced significant revisions to previous job reports, which were published in conjunction with January’s employment report. Nonfarm employment in March 2019 was revised down by more than 500,000 positions. Although the bulk of those revisions impacted prior years data, 12,000 previously reported jobs were knocked off of last years job creation totals.

Fewer than 2.1 million new jobs were created in 2019, making it the worst year for job growth since 2011.

Among Coronavirus fears of a sharp economic crash, strong new jobs and strong wage growth in January provided encouragement that the record-long economic growth still has room to improve. The latest health report also points to a maturing workforce market with 2019 job creation slowing to its slowest pace since 2011.


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