By Sydney Ember
Feb. 3, 2023Updated 4:01 p.m. ET
Soft landing? The American labor market is still soaring.
After months of gentle but steady declines in job growth, employers unleashed an unexpected burst of hiring in January, adding 517,000 jobs on a seasonally adjusted basis, the Labor Department said on Friday.
The increase was the largest since July, and it drew exclamations from economists steeped in labor market trends, who had been expecting another month of gradual cooling.
“So much for moderation!” said Beth Ann Bovino, the chief U.S. economist at S&P Global Ratings. “We certainly didn’t see it in this report.”
Underscoring the labor market’s extraordinary vibrancy was the unemployment rate, which fell to 3.4 percent, the lowest level since 1969.
But even as businesses hired with striking zeal in January — or at least laid off fewer seasonal employees than in most years — wage growth continued to moderate. Average hourly earnings increased 0.3 percent from December, and 4.4 percent over the year, an indication that some of the pressure to lure employees with pay raises may be easing.
“Put simply, I would argue the Biden economic plan is working,” President Biden proclaimed in remarks at the White House, while dismissing the “chorus of critics” who had faulted it.