State of the Labor Market

January 2019 Jobs Report: Strong Jobs Numbers Despite a Shutdown

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Affected government workers likely turned to part-time work

Although the shutdown impacted workers’ finances and consumer confidence, hiring seems to have proceeded at a fast clip. The economy added 304,000 jobs, which is higher than all but 10 months of this historic streak of job growth. Meanwhile, the unemployment rate edged up to 4.0% from 3.9%, while wage growth held steady at 3.2%.

The large jump in workers working part-time for economic reasons — from 2.9% of the labor force to 3.2% — is where the government shutdown shows most clearly, as workers who were struggling financially may have had to take on part-time work to make ends meet. On Indeed.com, over the course of the shutdown we saw job search rates for affected workers jumping quite sharply, showing that they were looking for opportunities, including part-time work, more intensely as the shutdown went on.

In addition, the unemployment rate for government workers hit 2.6%—almost 20% higher than it was in the last two years at this time.

The continued strength of hiring at this stage in a recovery is unprecedented. But these strong jobs numbers, while providing comfort about the strength of the economy, should not distract from the very real hurt that many workers suffered during the shutdown.

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