Market Commentary: Data Revisions Show Surging Jobs Market, Though Nearly 11 Million Openings Remain

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 The U.S. jobs market provided most of the major economic news last week. The latest establishment survey estimated 467,000 jobs were added in January. Regular revisions in the most recent months added an additional 709,000 jobs. The job market appears stronger than expected.

Key Points for the Week

  • The U.S. economy produced a surprising 467,000 jobs last month despite concerns Omicron would undermine hiring.
  • Unemployment increased to 4.0% because labor force participation jumped 0.9%, indicating more people returned to the labor force.
  • Job opening data from December indicate the economy is excelling at producing jobs, of which nearly 11 million are unfilled.

The household survey confirmed the data. Unemployment rose by 0.1% to 4.0%, primarily because more people were looking for work. The labor force increased by 1.4 million, and the household survey indicated 1.2 million jobs were created. That total includes self-employed workers, which aren’t captured in the establishment survey.

Wage increases remain rapid. Average hourly earnings surged 0.7% last month and are 5.7% higher than they were a year ago. Job openings and quit data from December show why. There are still nearly 11 million jobs unfilled in the U.S., and workers are quitting existing positions faster than normal.

The S&P 500 added to last week’s gains. The index of large-cap stocks climbed 1.6%. The MSCI ACWI rebounded 1.9% last week. The Bloomberg U.S. Aggregate Bond Index dropped 0.2%. The Consumer Price Index is the major economic release this week.

(Figure 1)

Back to Work

More Americans are getting back to work. The three major job reports last week indicate U.S. employment remains strong and continues to improve. According to the establishment survey, many more Americans went back to work last month and in previous months than expected. Despite concerns the report might show a loss of jobs, the initial report came in far higher. According to the establishment survey, 467,000 jobs were added in January. In addition to the big increase, the previous two months were also revised far higher. December’s estimate increased by 311,000 to 510,000. November’s estimate jumped by 398,000 to 647,000.

Revisions matter. In the last three months, the economy created more than 1.5 million jobs. Prior to the revisions and using the consensus estimate of 155,000 for the January report, the economy was estimated to have produced less than half that number. Generally, revisions are done for the prior two months, and the whole calendar year is revised once annually. In the 2021 revision, the total number of jobs was cut by 600,000, with the big gains in May-July reduced.

Restaurants and other leisure and hospitality businesses hired 151,000 workers in January, accounting for approximately one-third of the total gains. Many of the downward revisions in 2021 were for restaurants and other businesses. Even with the gains in January, the industry employs only 79% as many people as it did prior to the pandemic. The industries with the biggest percentage gains have been transportation and warehousing. The trend toward more online purchases of physical goods has increased demand. Health care and other services continue to lag in hiring workers back.

The household survey reported people are showing signs of being willing to return to work. The labor force grew by 1.4 million people as labor participation jumped 0.9%. Not all those people were able to find jobs, so the unemployment rate increased marginally from 3.9% to 4.0%. Hourly earnings shot up by 0.7%.

The JOLTS survey showed that even with stronger hiring and revisions, 10.9 million jobs remain unfilled. The mismatch between available jobs and worker skills continues to be wide as 4.6 million more jobs are available than there are people unemployed and looking for work. Labor force dynamics remain volatile. The quit rate held flat at 2.9% but remains well above the 2.5% rate prior to the pandemic.

What do all these numbers mean? First, the economy in 2021 was steadier than previously believed. Formerly strong hiring data in the late spring and summer were revised lower. Weak months, such as January and February, were strengthened significantly. Second, Omicron hasn’t affected the economy as much as early estimates suggested. Finally, wage increases show the inflation trend remains intact even as returning workers may help to slow hourly gains in coming months. Nothing in this report will change the Fed’s plan to increase interest rates in March.


This newsletter was written and produced by CWM, LLC. Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. The views stated in this letter are not necessarily the opinion of any other named entity and should not be construed directly or indirectly as an offer to buy or sell any securities mentioned herein. Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results.


The Standard & Poor’s 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.


The MSCI ACWI captures large- and mid-cap representation across 23 developed markets (DM) and 23 emerging markets (EM) countries*. With 2,480 constituents, the index covers approximately 85% of the global investable equity opportunity set.

Bloomberg U.S. Aggregate Bond Index

The Bloomberg U.S. Aggregate Bond Index is an index of the U.S. investment-grade fixed-rate bond market, including both government and corporate bonds.

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The Russell 1000® Growth Index measures the performance of the large cap growth segment of the US equity universe. It includes those Russell 1000 companies with relatively higher price-to-book ratios, higher I/B/E/S forecast medium term (2 year) growth and higher sales per share historical growth (5 years).

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