Jobs report shows increase of 517,000 in January, as unemployment rate hit 53-year low

The employment picture started off 2023 on a stunningly strong note, with nonfarm payrolls posting their biggest gain since July 2022. Nonfarm payrolls increased by 517,000 for January, above the Dow Jones estimate of 187,000 and December’s gain of 260,000, according to a Labor Department report Friday.

The unemployment rate fell to 3.4% versus the estimate for 3.6%. That is the lowest jobless level since May 1969. The labor force participation rate edged higher to 62.4%.

A broader measure of unemployment that includes discouraged workers and those holding part-time jobs for economic reasons also edged higher to 6.6%. The household survey, which the Labor Department uses to compute the unemployment rate, showed an even bigger increase of 894,000.

Markets, however, dropped following the report, though the major averages were mixed around midday.