US Job Growth Shows Signs of Fatigue with 130,000 Added in January
A delayed and highly anticipated labor market report released on Wednesday revealed that the United States added 130,000 jobs in January 2026, indicating a surge after months of fatigue in the employment sector. The unemployment rate was recorded at 4.3% for the month, showing a slight cooling since the fall. Economists had predicted only 70,000 job gains and an unchanged unemployment rate, making the actual figures a modest surprise.
Comparative Analysis and Revisions
The gains in January are still 13,000 jobs less than the 143,000 added in January 2025, but they more than double the 50,000 jobs added in December 2025. Despite this boost, the report included significant revisions to the total number of new jobs for 2025. After adjustments, total new jobs for the year were revised down to 181,000 from an initially reported 584,000, marking the weakest year of job growth since the Covid-19 pandemic.
The report comes after a tumultuous year for the US economy, with constantly changing trade and immigration policies contributing to instability in the labor market. Originally scheduled for release on 6 February, the report was delayed by the Bureau of Labor Statistics due to a brief government shutdown in early February.
Private Sector and Layoff Trends
In advance of the report, private payroll grew by only 22,000 jobs in January, falling below economists' expectations of 45,000 jobs. This is a sharp decline from the same period last year, when private payrolls gained 140,000 jobs. Additionally, US employers announced 108,435 layoffs in January 2026, according to outplacement firm Challenger, Gray & Christmas, representing a 118% increase from January 2025 and the highest number to start a year since 2009.
Job openings in the US also dropped in December 2025 by 386,000 jobs to 6.542 million, the lowest level since September 2020, as reported by the Job Openings and Labor Turnover Survey (Jolts) released last week.
Expert Warnings and Economic Factors
On Tuesday, White House adviser Peter Navarro warned against high expectations for the monthly jobs number, claiming that new jobs would be in the 50,000 range. He stated, "We have to revise our expectations down significantly for what a monthly job number should look like." Navarro attributed inflated job figures during the Biden administration to immigration policies, suggesting that many jobs were going to undocumented immigrants.
The weakening labor market has not been slow enough to inspire the US Federal Reserve to slash interest rates, as US inflation remains unstable. Last month, economists noted that the unemployment rate leveling at 4.4% could be a sign of stability, though job gains have been low. Slowed job growth is attributed to new immigration policies, labor force participation, and tempered demand for labor, according to Fed officials.
The central bank is also exercising caution regarding increasing prices. US inflation was 2.7% in December, with effects of tariffs still flowing through prices. Higher prices have continued to impact consumer sentiment: According to the University of Michigan's survey, sentiment was 57.3 in February, a slight improvement over the past six months but more than 11% lower than the same period in 2025.
