The Trump boom, cont’d

The Wall Street Journal’s Real Times Economics email newsletter featured the monthly jobs report released on Friday. Lest we take the good times for granted, let us take a break from the continuing Russia hoax to take in signs of the boom. The Journal newsletter headlines 304,000 jobs added in January along with the slight increase in the unemployment rate to 4 percent from 3.9 percent. Chief Journal economics commentator Greg Ip contributed the lead item:

Cyclically and Structurally, a Great Job Market

Some amazing things are going on in the jobs market. First, it’s strong: nonfarm employment soared 304,000 in January from December, nearly double expectations. Neither the partial federal government shutdown nor market turmoil had any apparent impact on private hiring. Second, it’s getting stronger: in the last three months job creation was its fastest in three years. Third, and most notable, the U.S. is defying its demographic headwinds. The participation rate (the share of the population working or looking for work) is supposed to be falling as the baby boomers retire. Instead it has climbed to 63.2%, a five-year high. That’s thanks to surging participation among prime-age workers, especially women, whose participation, at 76%, has matched its highest since 2003. This is why unemployment has actually edged higher even as job creation has soared (though the uptick to 4% in January was muddied by the shutdown).

The long expansion is thus overturning assumptions about how finite the supply of labor is, and the tightness of the labor market. That’s also happened in other countries, notably Japan. This doesn’t tell us how far the expansion has to run, but it does not appear in any danger of succumbing to bottlenecks and inflation.

Ip’s item ran with the table below.