According to the latest data released on Wednesday via ADP and Moody’s Analytics, 2018 brought great news to the American worker, with businesses adding 234,000 new jobs in January, which is well above the estimated 185,000 figure. Most of the newly created jobs were, as usual I might add, in service related industries, 212,000 respectively, while construction added 9,000 and manufacturing added 12,000.
According to estimates, economists had been looking for private payrolls to grow by only 185,000 in January. Solid job gains were also observed in better paying industries, within the service-related industries that is: transportation, trade and utilities saw 51,000 new jobs, health services and education added 47,000 jobs, professional and business services grew by 46,000 jobs and finally, hospitality and leisure industries contributed 46,000 new jobs. The Atlanta FED is predicting the US economy to grow by 4.2% in the 1st quarter of 2018, while the national unemployment rate stands at 4.1%. The Federal Open Market Committee concluded its 2-day meeting on Wednesday announcing that the Federal Reserve will not change interest rates for now, at least until March when their new meeting is scheduled.
Moreover, according to the Labor Department data, total compensation for US employees rose again in the 4th quarter of 2017, and it’s now matching the biggest twelve month gain since 2018, as the economy is starting to roar and the private sector is picking up. Total compensation rose 2.7 percent over the past twelve months, which is the highest since 2008.
However, good news aside, keep in mind that the Federal Reserve will definitely raise interest rates this year at least two more times (and you can take that to the bank) citing fears of inflation (also created by the FED via its monetary policy); then, the companies will not be able anymore to buy back their stock via cheap overnight loans. The era of cheap money is over, and Trump will be held accountable for the planned collapse of the US economy sooner rather than later. Just wait and see.