America’s jobs engine roared in January and wage gains rebounded, offering fresh momentum for the economy and a tailwind for President Donald Trump at the start of the election year.
Payrolls increased by 225,000 after an upwardly revised 147,000 gain in December, according to Labor Department data Friday that topped economists’ estimates.
The jobless rate edged up to 3.6 percent, still near a half-century low and reflecting more Americans entering the workforce.
Average hourly earnings climbed 3.1 percent from a year earlier.
The figures help support the president’s description of a “booming” job market during this week’s State of the Union address.
While Boeing’s production halt on the 737 Max airplane and the coronavirus outbreak are likely to weigh on the economy in coming months, a resolution of those issues by midyear could perk up growth just before voters head to the polls in November.
A strong labor market and record-high stock prices have helped boost Americans’ views of their finances to all-time highs. Nearly six in 10 Americans say they are better off now than they were a year ago, as 74 percent said they will be even better off next year, according to a Gallup poll out earlier this week.
“If the job market continues to perform as it is today on Election Day, it should be a tailwind to the president’s re-election,” said Mark Zandi, chief economist at Moody’s Analytics.
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He cautioned, though, that the labor market in swing states will be more important to Trump’s prospects, as places like Pennsylvania, Michigan and Wisconsin have showed weakness related to manufacturing.
Investors were focused on the spread of the coronavirus Friday, as U.S. stocks declined from a record, the dollar was up and yields on the 10-year Treasury were lower.
A key positive from Friday’s report was a pickup in the participation rate, or the share of working-age people in the labor force, to a more than six-year high of 63.4 percent. Among prime-age workers, or those ages 25 to 54, the share is the highest since 2008. The employment-population ratio was also at an 11-year high.