Post-growth, employment grows more than expected in the United States

More than 353,000 jobs were created… The American job creation figure in January surprised observers, especially since it was accompanied by a sharp increase in the tentative figure for December 2023 (333,000 new jobs instead of 216,000). “Speechless”said Michael Cramer, founder of investment firm Mott Capital Management. “The number of jobs that crushed expectations, but more impressive wage growth was near doubling… Forget the rate cut in March. »

The US economy continues to grow at full steam, as shown by growth figures for the last quarter of 2023, which exceeded expectations (3.3% annualized). Employment growth was broad during January, led by the business services sector and its 74,000 jobs. Other significant contributors include health care (70,000), retail (45,000), government (36,000), welfare (30,000) and manufacturing (23,000). The unemployment rate is steady at 3.7%.

An additional indicator of optimism: Growth in average hourly wages in the non-farm private sector accelerated, rising 0.55% in January (+6.6% at an annualized rate), not seen since March 2022. What creates fear is the inflation-wage growth spiral. In this regard, the markets are no longer counting on a rate cut by the Federal Reserve (Fed) in March – its president, Jerome Powell, almost officially indicated this during his press conference on Wednesday 31 January. “I don’t think the committee is likely to reach that level of confidence (enough) Between now and the March meeting (To start reducing rates) But that remains to be seen.”, Mr. Powell declared. Monetary easing is now expected in May.

Interest rates have tightened

Logically, interest rates tightened – ten-year rates rose to more than 4% from 3.88% when the unemployment figures were released – while Wall Street, which was preparing to open with fanfare thanks to fantastic results from Meta and Amazon, announced earlier in the day. Made some progress early in the morning. However, the stock market rallied mid-day (+0.9% for the S&P 500 and +1.4% for the Nasdaq, an index of technology stocks): “Too bad for higher rates, better growing economy,” the market wanted to say when it changed its mind. was The dollar strengthened with the euro trading down one cent at $1.08.

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