According to government data released on Friday, US job gains increased unexpectedly last month as unemployment fell to its lowest level in more than five decades, signalling resilience in the labor market despite measures to slow down economic activity.
Policymakers may find this to be troubling given the possibility that rising salaries could fuel inflation.
The latest numbers may cause the US central bank to raise interest rates more frequently than anticipated, despite the fact that it has scaled back its vigorous campaign to control prices in response to indications that the world’s largest economy is weakening.
After a five-month downturn in hiring, the United States surprised observers by adding 5,17,000 jobs in January, nearly double the number from December, according to the Labor Department on Friday.
‘Job growth was widespread, led by gains in leisure and hospitality, professional and business services, and health care,’ the report added.
Employment in manufacturing and construction showed resilience as well, despite a slowdown in activity in both sectors. The jobless rate edged down to 3.4 per cent, a level last seen in 1969, according to government figures.
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