The US labor market just delivered a major upside surprise. January nonfarm payrolls rose by 130,000, roughly double what economists were expecting and a sign that hiring remains resilient despite broader economic uncertainty.
Markets took the news in stride, with the SPDR S&P 500 ETF $SPY ( ▲ 0.11% ) moving higher in premarket trading after the release.
Hiring Easily Tops Expectations
Economists had forecast around 65,000 new jobs for the month, but actual gains came in far stronger. Even prediction markets had leaned more cautious, with expectations clustered closer to lower outcomes.
The unemployment rate also edged down to 4.3%, beating forecasts that it would hold steady at 4.4%.
Healthcare Did the Heavy Lifting
Job growth was heavily concentrated in one area. Healthcare accounted for about 123,500 of the new positions, representing the vast majority of total gains.
That concentration suggests other sectors of the economy remain more subdued, even as demand for healthcare services continues to drive hiring.
A Labor Market That Refuses to Cool
Despite higher interest rates and ongoing recession worries, the labor market continues to show surprising strength. For policymakers, strong job creation paired with a lower unemployment rate may complicate the path forward on rate cuts.
For investors, the report reinforces the idea that the economy still has momentum, even if that strength is not evenly distributed across industries.