The US economy added fewer jobs than anticipated in January and overall hiring was weaker than previously reported in 2024, although the pace picked up dramatically at year-end.

That’s all according to Friday’s BLS release, which included closely-watched revisions.

Headline hiring (i.e., the NFP print) was 143,000 for last month. That was well short of the 175,000 consensus, and marked a meaningful slowdown from the brisk pace recorded during the final two months of 2024. The range of estimates from — chuckles — 79 highly-credentialed soothsayers was 105,000 to 240,000.

The BLS’s final attempt at the annual benchmarking process resulted in a 589,000 downward revision to March of 2024’s employment level, near (or even below) the low-end of estimates and considerably lower than the figure the government’s number-crunchers came up in August, when the preliminary results of the exercise were released.

Overall hiring on the establishment survey in 2024 now stands at 1.996 million, down from 2.232 million before the revisions.

The figure, above, shows you the impact, both in aggregate and on a month-to-month basis, of the BLS’s statistical floor routine.

The overarching message: Hiring was slower than originally estimated for most of 2024, but quicker than previously reported in November and December, when the US economy added 568,000 jobs. Note that the headline NFP prints for those two months were already strong. As revised, they’re quite robust indeed.

If you’re wondering how the “average” market participant can possibly parse all of that in real-time, let alone incorporate it into a trading “strategy,” the answer is that such a person can’t, and shouldn’t try. It’s not so much that it’s “complicated” (it’s not), it’s just pedantic and you really have to be an obsessive to analyze it on the fly. Either that, or you have to be a media conglomerate.

Anyway, the figure below should help you organize your thoughts. It’s the updated (i.e., revised) NFP series, with the three-month moving average.

Again, the upward inflection over the final two months of 2024 now looks even steeper than it did and that, in turn, makes January’s 143,000 headline feel a bit like a brake slam. Thanks to the rapid pace of job creation late last year, the three-month average on the NFP headline is now 237,000, the quickest in nearly two years.

Looking at the breakdown, most of the hiring last month was in health care, retail, social assistance and government. Elon Musk is hard at work trimming government payrolls and bullying federal employees into quitting. Some worry he hasn’t thought that push all the way through. Others wonder why Musk should be in charge of such an effort in the first place.

The jobless rate in January ticked lower, to 4% (4.011% unrounded). That decline looked especially notable in light of an uptick in the participation rate.

As for wage growth, it was warm. As in 0.5% warm. That won’t work if you’re the Fed. You need 0.3% or lower if the YoY pace is going to remain consistent with 2% underlying consumer price growth (i.e., inflation).

The 12-month pace on the AHE series for January was 4.1%. The figure above shows the rounded MoM readings. Unrounded, January’s month-to-month increase was the most pronounced in a year.

I won’t pretend to know how markets will trade the release, but the takeaway should probably be that hiring and wage growth are running too warm for comfort despite the deceleration in job growth tipped by the January NFP headline.

That’s not to say we won’t look up a few months from now and remember that 143,000 print as the start of “something,” it’s just to suggest there might’ve been some “giveback,” so to speak, from the nearly 600,000 jobs added over the prior two months.

And anyway, the three-month average tells the story: Employers are hiring. (Remember that the October low print was distorted by weather and work stoppages.)

As BMO’s Ian Lyngen put it Friday, “Overall, despite the disappointing [January] headline miss, the underlying details were strong.” The numbers, he went on, are “consistent with the Fed remaining on hold.”