The US economy added over 3 million jobs in 2014, the most since 1997.

1. Economics for your Classroom from
Ed Dolan’s Econ Blog
US Private Sector Jobs
Grow at Fastest Pace since
Dot.Com Boom
Feb 7, 2015
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2. Strong Upward Revisions Add to Job Gains
 The economy added a robust
257,000 payroll jobs in January
2014, according to a preliminary
report from the Bureau of Labor
Statistics
 Upward revisions added 147,000
jobs for November and December, in
addition to strong gains already
reported
 Smaller revisions for earlier months
reflect annual “rebenchmarking”
February 7, 2015 Ed Dolan’s Econ Blog

3. Fastest Private Job Growth Since Dot.Com Boom
 Over the 12 months since January
2014, the economy added 3,127,000
new private sector jobs
 That was the fastest 12-month rate of
job creation since the dot.com boom of
the 1990s
 Over the course of the year, total
government jobs decreased by 80,000
February 7, 2015 Ed Dolan’s Econ Blog

4. Unemployment Rate at 5.7 Percent
 The US unemployment rate rose
fractionally to 5.7 percent in January,
remaining near its low for the recovery.
 The unemployment rate is the ratio of
unemployed persons to the labor force.
The labor force grew by 1,051,000 for the
month. The number of employed persons
increased by 759,000 and the number of
unemployed increased by 291,000
 The household survey on which
unemployment data are based uses a
different methodology from the
establishment survey of payroll jobs
February 7, 2015 Ed Dolan’s Econ Blog

5. Broad vs. Standard Unemployment Rate
 The BLS also provides a broader
measure of job-market stress, U-6
 The numerator of U-6 includes
 Unemployed persons
 Marginally attached persons who
would like to work but are not looking
because they think there are no jobs,
or for personal reasons
 Part-time workers who would prefer
full-time work but can’t find it
 The denominator includes the labor force
plus the marginally attached
 U-6 rose to 11.3 percent in January, near
its low for the recovery
February 7, 2015 Ed Dolan’s Econ Blog

6. Long-term Unemployment
 Signs of slack in the labor market remain,
including a level of long-term
unemployment that has remained very
high by historical standards
 In January 2014, 31.5 percent of all
unemployed workers had been out of a
job for 27 weeks or longer
February 7, 2015 Ed Dolan’s Econ Blog

7. Involuntary Part-Time Workers
 Another sign of slack is the large
number of people working part time
“for economic reasons,” that is,
because they can only find part-time
work or because their employers have
cut their hours due to slack demand
 The percentage of the labor force
working part time for economic
reasons fell to a new low for the
recovery in January, but it remains
higher now than it was before the
Great Recession began
February 7, 2015 Ed Dolan’s Econ Blog

8. The Bottom Line: Labor Market Strong but Room to Grow
 The labor market is improving strongly
and, by some indicators, is approaching
levels consistent with the Fed’s mandate
to maintain “maximum employment”
 However, low inflation and broader
indicators of job slack suggest that there
is no hurry to tighten policy. Significant
room for growth remains.
February 7, 2015 Ed Dolan’s Econ Blog

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