US job growth seen accelerating in January but retail jobs set to fall
today Feb 3, 2017
US job growth likely accelerated in January, with wages expected to have increased steadily, suggesting a strong start for the Trump administration as it seeks to boost the economy and employment.
But retail payrolls probably declined as workers hired during the holiday season were laid off. A sharp drop is also likely after retailers, including Macy's, Sears, American Apparel and Abercrombie & Fitch announced job cuts amid store closures.
Department store sales are being undercut by online retailers, led by Amazon.com.
Non-farm payrolls probably increased by 175,000 jobs last month, in part as warm weather bolstered hiring in the construction sector, according to a Reuters survey of economists. That would be a pick-up from the 156,000 jobs created in December.
President Trump vowed during last year's election campaign to deliver 4% annual gross domestic product growth, largely on the back of a plan to cut taxes, reduce regulations, increase infrastructure spending and renegotiate deals in the United States' favor.
Although details on the policy proposals remain sketchy, consumer and business confidence have surged in the wake of Trump's election victory last November.
But with the economy near full employment, some economists are skeptical of the growth pledge. Annual GDP growth has not exceeded 2.6% since the 2007-08 recession.
With the minimum wage taking effect in more than a dozen states in January, average hourly earnings are forecast to have risen by 0.3% after increasing 0.4% in December. However, the year-on-year gain in earnings is expected to fall to 2.8% from 2.9% in December as the jump in wages seen in January 2016 drops out of the picture.
Rising wages could pave the way for the Federal Reserve to raise interest rates this year. The unemployment rate is forecast unchanged at 4.7%.
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