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January Jobs Report Shows Growth Despite The Shutdown

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January jobs report

The January jobs report was released on Friday and, despite the government shutdown, there was growth in the job market once again. This marks 100 months of consecutive growth. President Trump took to Twitter to celebrate the latest Trumponomics triumph.

The Job Market Post-Government Shutdown

Although there were another 304,000 jobs added to the market in January the employment rate went up slightly. There is no doubt this is due to the fact that many government workers were forced to file for unemployment or assistance during this time.

That being said, many people were pleasantly surprised by the post-shutdown jobs report. It showed the economy added 304,000 jobs during the first month of the year. The number 304,000 does not reflect any jobs impacted by the shutdown because the Labor Department knew those individuals would be paid eventually and, therefore, were reported as gainfully employed.

What Did The January Jobs Report Say?

The unemployment rate was up due to government workers not able to collect a paycheck. However, it only increased by 0.01 percent from December. There is speculation that the unemployment rate should have actually been higher (4.1 percent).

Another note to take away from the January jobs report is the number of people taking on part-time jobs increased. This was likely due to people being out of work during the shutdown. The Labor Department reported that 490,000 more people were working part-time in January but were searching for full-time work. So, there is still plenty left to be desired where the United States job market is concerned.

Despite the continued growth in the job market, the government shutdown did have a real impact on 800,000 workers in the U.S. Some people were unable to pay bills or put food on their table. Not to mention, the unemployment rate is on the rise again (largely due to the shutdown). And, if no agreement is made soon, it will happen again.

Readers, what do you think about the possibility of another shutdown? What do you think the long-term impact may be?

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Strong December Jobs Report Looks Good, but Wages Fail to Keep Pace

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Job report is best in 15 years, but wages still lacking
The years 2008 and 2009 were characterized by loss: the loss of approximately 8.4 million jobs, the loss of consumer confidence in the markets, as well as steep declines in the values of homes. What did increase were the federal debt, inflation, and the numbers of personal bankruptcies filed by individuals. Eventually, the economic decline in world markets reached its bottommost level, and ‘loss’ in its many manifestations (i.e. job, home, savings) became the status quo.

Nearly five years later, however, economists have declared 2014 the best year since 2009. According to the Christian Science Monitor, 200,000 jobs were added each month during 2014 in what the Wall Street Journal called the “best year of job growth in 15 years.” Additionally, the New York Times reported that many of the recently created jobs are higher-paying opportunities in industries that have been especially aggressive in hiring, such as health care and construction work. Overall, between 2013 and 2014, the unemployment rate decreased over a full percentage point, to hold at 5.6 percent in December 2014.

Despite this good news, researchers have cautioned against reading the report through a rose-tinted lens. In particular, despite this year’s robust job growth, hourly earnings in December rose only 1.7 percent compared to this time last year, barely above inflation rates.

The result of this mathematics is firms are able to collect and protect their profits, while many U.S. households will be unable to increase their living standards. In fact, Federal Reserve officials have used this data to suggest that the economy is “far from its full capacity,” though the dollar has been at its highest point in years, another sign of economic improvements. As Elise Gould tells SF Gate, “…we are still digging our way out of the recession, and wage growth remains stagnant and untouched by recovery.”

But 2014 is gone and some analysts believe that 2015 will be “the year of the consumer,” given declining oil prices and the lower costs for imported goods. In fact, an economist questioned by SF Gate likened the lower oil prices to a $1000 pay raise, if prices remain low. Additionally, Mark Znadi, chief economist at Moody’s Analytics, told the New York Times that as the economy heads toward a 5 percent unemployment rate, wage growth is also expected to increase.

Millions of Americans, however, are still searching for full-time employment, while others have dropped out of the labor force altogether. As Dan Greenhaus, chief strategist at the brokerage firm BTIG told WSJ, “The simple fact is we cannot consider an employment report a success…if wage data does not begin to accelerate” as well as the number of Americans with work.

(Photo courtesy of Tess Aquarium)

S&P 500 Ends Week at Another Record High with Gains for Fifth Week in a Row

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The S&P 500 ends week at another record high
It was another good week for stocks with the Standard and Poors 500 (S&P 500) closing at its highest level ever once again. The rise was spurred by a jobs report which came in weaker that most analysts anticipated. This news was taken by investors as indicating the Federal Reserve will hold off on raising interest rates for the foreseeable future to continue to help the economy. The weak jobs report gives ammunition to those who say the economy is still struggling and interest rates should remain low to help it.


The S&P 500 was up 10.06 points (0.5%) for the day ending up above the 2,000 mark again, at 2,007.71. This was a 0.2% gain for the week. The 2,000 point level, while not having any significant economic meaning for the index, continues to have a strong psychological meaning to many traders. The S&P 500 is still struggling to maintain closings above this level on a daily basis, but it may be able to do so in the weeks to come as it continues to slowly end each week a bit higher than the previous week. This is the fifth week in a row the S&P 500 has managed to end higher than the week before.

The Dow Jones industrial average ended the day up 67.78 (0.4%) points to 17,137.36, and managed a 0.2% gain for the week. The Dow helped to solidify its position above the 17,000 mark this week and looks like it should maintain this level in the weeks to come, baring any unexpected geopolitical unrest which spooks investors.

The Nasdaq Composite increased in value by 20.61 points (0.45%) on Friday to 4.582.90, an increase of 0.06% for the week. While the Nasdaq continues to remain well below its all-time high during the dot com bubble, it continues to inch its way back toward the 5,000 mark ,week by week.

Utilities had a good day with a 1.2% gain as investors found them appealing after payroll release numbers had bond yields falling. Utilities, with their strong dividends, are a place of refuge for many investors when bond yields fall.

Apple ended Friday up 0.9% to $98.97. After breaking $100 a share, the stock has been unable to remain above that mark. Rumors continue to abound about what will be announced at their much anticipated September 9 news conference and if the new products can meet investors’ expectations. The stock was also hit when their iCloud was rumored to be part of the issue on how the celebrity nude photos ended up being hacked, although they have denied there was a breach in this area. They have also announced they plan to add new iCloud security features.

Family Dollar Stores decreased 1.2% to $79.11 after rejecting a new and sweeter offer from Dollar General in the battle between dollar stores. The rejection also hurt Dollar General shares which fell 2.3% to $63.01.

(Photo courtesy of ilaria)