Employers added 467,000 jobs in January even as omicron spread U.S. employers added 467,000 jobs last month despite a surge of coronavirus infections. The unemployment rose to 4% from 3.9% in December.

In a big surprise, the job market surged in January even as omicron cases spiked

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ARI SHAPIRO, HOST:

The omicron wave of coronavirus infections took a terrible toll on Americans health last month, but the pandemic's punch to the economy was much less painful than had been expected. A stunning report from the Labor Department this morning shows U.S. employers added a surprisingly large number of jobs in January - 467,000 - even as the number of new infections hit record highs. Job gains for November and December were also much stronger than initially reported. NPR's Scott Horsley joins us to explain. Hi, Scott.

SCOTT HORSLEY, BYLINE: Hi, Ari.

SHAPIRO: This sounds like a big surprise. Ahead of this report, there was a lot of concern from analysts that the news would be terrible. What happened?

HORSLEY: Yeah, the job market proved to be much more resilient than those analysts had expected. During previous waves of the pandemic, some would-be employees had stayed home to avoid getting sick. Some employers cut back on hiring, especially in sensitive industries like restaurants. And a lot of forecasters thought we'd see something similar in January, but it really didn't happen. Restaurants added 108,000 jobs last month as Oberon was infecting more than 800,000 people a day. Retailers added 61,000 jobs. It's not as though COVID had no impact on the job market. There were more people calling in sick, for example. But White House economic adviser Cecilia Rouse says the economy appears to be somewhat inoculated against the worst effects of the pandemic.

CECILIA ROUSE: We have an economy that is learning to continue to function even in the face of a wave such as omicron. We saw a blip up in temporary layoffs, but we didn't see, you know, a massive closing down, shutting down the economy.

SHAPIRO: I'm imagining this was very welcome news at the White House.

HORSLEY: Oh, you bet. You know, not only were January's jobs numbers better than expected, but revisions to November and December's numbers showed hiring in those months was much stronger than initially reported. What had looked like a slump at the end of last year, in fact, turned out to be pretty solid job growth. And we could be poised for more strong hiring in the months ahead now that omicron is receding. That would, of course, be good news for President Biden, whose approval rating on the economy has fallen below 40%. And Biden today called this a sign of the extraordinary grit and resilience of the American people.

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PRESIDENT JOE BIDEN: Our country is taking everything that COVID has to throw at us, and we've come back stronger.

SHAPIRO: So why, in the face of all these new jobs being created, did the unemployment rate also inch up in January?

HORSLEY: Yeah, the jobless rate did go from 3.9 to 4% last month but only because more than a million people came into the workforce. And we want to see that because, you know, at times, the recovery has been hobbled by a lack of available workers. That's been one of the factors tangling supply lines and driving up prices. We know there's a near-record number of job openings in the country. And White House economist Rouse says having more people to fill those jobs is a step in the right direction.

ROUSE: We still have work to do. There are still people who are hesitant to be - start looking for jobs. We know that there are still people who are having trouble finding child care or at least stable child care. And so we still know that there's progress to be made. But what this reflects is that there's been tremendous growth in our labor market and that the economy is a lot healthier than we might have thought.

HORSLEY: There are still fewer people working or looking for work than there were before the pandemic, but that gap is narrowing. And that's a good way to start the new year.

SHAPIRO: NPR's Scott Horsley on some unexpected good economic news today. Thank you, Scott.

HORSLEY: You're welcome.

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