FEBRUARY 7, 2022 – EMPLOYMENT SOARS IN JANUARY DESPITE THE VIRUS
The Labor Department announced US payrolls grew by 467,000 in January, far exceeding expectations for 150 ,000 new jobs. Job growth for November and December was adjusted upward by 709,000 positions. It is thought the January job number would have been even higher had it not been for the Omicron cases, with about 2 million people prevented from looking from work last month due to illness.
The unemployment rate was up marginally to 4 percent from 3.9 percent from the previous month as more people joined the workforce. Wages were up 5.7 percent in January, year over year, nearly twice the 3 percent average wage increase prior to the pandemic.
Low unemployment along with rising wages and persistent inflation will keep the Fed on track to start lifting interest rates in March as previously stated. The probability of the Fed’s raising rates by 0.5 percent rose to 27 percent after the jobs report; however, the Fed usually increase the rate in 0.25 percent increments. The chances of six increases this year rose to 51 percent. Rates are going up, and soon. Act now to lock in historically low rates by using interest rate hedges.