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U.S.: Service Employment Surpasses Pre-Recession Peak

ByThe National Bank of Canada
Published 02/04/2013, 07:13 AM
Updated 05/14/2017, 06:45 AM
NWSA
-1.06%

The U.S. jobs market remains on a sound footing early in 2013. Payroll employment rose 157,000 in January on the back of a 121,000 increase in serviceproducing jobs. As today’s hot Chart shows, service employment (private and public) rose to 116.3 million, surpassing its pre-recession peak. Such a milestone remains elusive for the goods sector where employment is still down 4 million jobs from its prerecession peak. The good news, however, is that the construction sector has shown encouraging signs in the recent months (+100 K jobs in 6 months). We would expect this development to persist through 2013. Even though we do not expect overall job creation to accelerate much in the coming months the good news is that the combination of higher employment, a longer workweek and a rise in hourly earnings in January is helping support personal income. As shown, the aggregate wage bill of all employees (private and public) is already up an annualized 3.5% early in Q1. The wage gains will bring some support to consumption spending, and provide some offset to the tax hike earlier this year. So expect a GDP rebound in Q1. After that, much depends on the size of the spending cuts to be approved by Congress.
Service employment surpasses pre-recession peak

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