Blockbuster Jobs Report: Is Monetary Policy Tight?
Wow, so much for a slowing economy triggered by a tightening monetary policy. Payroll employment rose by 517,000 in January, private sector workers' wages (ex-supervisory) rose 0.3%, and the average workweek jumped 0.3 hours to 34.7. The increase in hours boosts workers' income by a significant amount---by my calculation, it is equivalent to hiring an additional 1.4 million workers.
BLS publishes a household series on jobs using the payroll concepts. It rose 868,000 in January, following an 826,000 gain in December. And the jobless rate dropped to 3.4%, down 0.1 percentage point.
Interestingly, the Fed received a snapshot of the hours worked data on Wednesday. Did Fed Powell look at the data before the press conference.?