The United States delivered another bigger-than-expected batch of jobs last month, adding further evidence that the economy still has plenty of steam even as its fuel reserves dwindle.
Employers added 353,000 jobs in January, the Labor Department reported on Friday, and the unemployment rate remained at 3.7 percent.
After the loss of 14 percent of the nation’s jobs early in the Covid-19 pandemic, the labor market’s endurance for more than three years has surprised economists, who expected factors including the Federal Reserve’s interest rate increases to slow hiring more sharply.
“There’s layoffs happening, but workers are able to find new positions,” said Sara Rutledge, an independent economics consultant. “It’s almost like a ‘pinch me’ scenario.”
Ms. Rutledge helped tabulate the National Association for Business Economics’ latest member survey, which found increasing optimism that the country would avoid a recession — matching a turnaround in measures of consumer confidence as inflation has eased.
The new year dawned on what has been an exceptionally good economy for many workers, with the number of open jobs still exceeding the stock of people looking for positions, even as new immigrants and women have joined or rejoined the work force in unexpected numbers. Wages have been growing faster than their historical rates, and a strong increase in productivity has helped keep those fatter paychecks from fueling price increases.
Over the past year, most gains have been powered by sectors that either took longer to recover from the pandemic — including hotels, restaurants and local governments — or have outsize momentum because of structural factors, like aging demographics and pent-up demand for housing.
Other categories that experienced supersized growth during 2021 and 2022, including transportation, warehousing and information technology, have been falling back to their prepandemic trends. Another handful of sectors, including manufacturing and retail, have been largely flat.
In the coming months, economists expect the labor market to become even more like its prepandemic self, without the giant job growth that followed the pandemic lockdowns but with few clear obstacles on the horizon.
“This year will be the year where industrial makeup will normalize,” said Satyam Panday, chief U.S. economist with S&P Global Ratings. “There’s always a risk of undershooting the trend as well. But it seems like more and more that soft landing is coming into view, at least at this point.”