Unemployment Rate Drops to 5.6%

While a few big distortions make analysis of underlying employment trends difficult, it appears that conditions in the labor market are indeed improving, even if they remain weak

January nonfarm payrolls decreased 89,000, and the unemployment rate surprised with a decline to 5.6% from 5.8%. The workweek decreased to 34.0 from 34.1 hours, while hourly earnings were unchanged. Overall, the payroll data was in line with expectations, with much of the weakness due to another big drop in manufacturing (-89,000).

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