Weekly economic review & outlook
Employment data not as strong as hoped
February 08, 2021
You Need to Know
Week in review
Positive but weak job growth for January
Payrolls expanded by a mere 49,000 as hiring by many service sector businesses remained hampered by COVID restrictions. But unemployment fell sharply.
ISM surveys show continued business expansion
Surveys for services and manufacturing remained solidly in expansion territory for January despite the recent general economic slowdown.
CPI expected to rise due to climbing energy prices
For the second month in a row, rising energy prices are likely to be the impetus for strong consumer price growth. But core CPI inflation is expected to remain modest.
Consumer sentiment should rise due to improved expectations
Positive early returns on vaccine effectiveness and the likelihood of further fiscal stimulus should boost consumer expectations and, consequently, consumer sentiment
Nonfarm payrolls rose by a meager 49,000 for January, with downward revisions to the prior two months, as hiring remained soft, especially within sectors dependent upon in-person consumer activity with government restrictions on mobility still in place. Private payrolls climbed by only 6,000 and were 100,000 jobs below the previously released total for December 2020 after annual benchmark revisions. The leisure and hospitality sector was the worst performing again, falling by 61,000 during January after plummeting by 536,000 for December. Compared with January 2020, total employment was still down by 9.6 million.