The employment numbers released by the Labor Department are the best in many years. The economy created 292,000 jobs, and the labor force participation rate rose to 64.6 percent, showing that more Americans entered the labor market in search of work—and found it.
Even subtracting the 35,000 new jobs in temporary help services, an artifact of the Christmas season, leaves the economy with over 250,000 new jobs. Many are in low-paying sectors such as education and health services and leisure and hospitality, but experience in these sectors can translate into better jobs in the future. The unemployment rate remained at 5 percent. This shows that the Federal Reserve took the right step last month in beginning to raise interest rates.
Diana Furchtgott-Roth is Director of Economics21 and Senior Fellow at Manhattan Institute and former Chief Economist for the U.S. Department of Labor.