U.S. | Tepid employment report underscores need for additional stimulus

Summary

January’s labor market report continued to show strains from the resurgence in Covid-19 cases, with nonfarm payrolls relatively unchanged at +46K. Despite the tepid hiring conditions, the unemployment rate fell 40bp to 6.3%, with the number of unemployed dropping by 600K.

Key points

• Key points:
• The pandemic continues to wreak havoc in the labor market
• Employment contraction in some industries and high rates of long-term unemployment highlight the need for government aid
• Vaccination efforts will be key to restore normality in severely affected industries
• About 34.8 million workers had to work remotely due to the pandemic

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