Economy added 234,000 jobs in January

It's better than replacement level, which means it keeps up with population growth and then some. But a truly booming economy would be topping 300,000 or even 400,000 new jobs a month given the size of the population and of the workforce as presently constiuted. One of the reasons it might be hard to create many jobs right now is that unemployment is low so it's hard to fill good paying jobs. Changing that will require a lot of people who left the work force over the course of the past decade to come back into it. Tax reform should create a lot of openings for that to happen, so maybe we'll see them trickling back in over the course of 2018.

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For January, though, with the tax cut only starting to have an effect, we're still taking toddler steps:

Firms across the country added 234,000 workers in January, according to payroll processor Automatic Data Processing Inc. and forecasting firm Moody’s Analytics. Economists surveyed by The Wall Street Journal had expected the addition of 193,000 jobs. “Service providers were firing on all cylinders, posting their strongest gain in more than a year,” said Ahu Yildirmaz, vice president and co-head of ADP Research Institute, in the report. The December figure was revised down to 242,000 from 250,000. The ADP report is based on private-payroll data in addition to government data. Still, the report raised concerns over employee shortages given the unemployment rate. “The job market juggernaut marches on,” said Mark Zandi, chief economist of Moody’s Analytics. “If it falls short, it is likely because businesses can’t find workers to fill all the open job positions.” Growth was driven by midsize and large companies while job growth at smaller firms slowed slightly.

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Top-line economic growth is the most important figure to watch as we assess how the economy is doing. If growth is strong, numbers like job creation, wages and other things will follow at their own speed. The 2.6 percent growth we had in the fourth quarter of 2017 was disappointing because we thought it would top 3.0 percent for a third quarter in a row. But the trajectory still appears positive and 234,000 new jobs in the first month of the first quarter of the new year is consistent with that. The purpose of Trump policies like tax reform, energy development and deregulation is not to give us a modest bump in economic activity, though. It's to unleash a boom. The fundamentals for that to happen appear to be there, but the numbers that have been released over the course of the past couple weeks aren't what we need to see to tell us the boom has arrived. All in good time, though. I'm convinced that 2018 will be a year of tremendous activity as companies redirect the capital that would otherwise have been spent paying federal taxes. It will probably take more than a single year to really see the full economic effects of that rediction, but you'll clearly see things changing this year. That should be a good thing for congressional Republicans who desperately want to hang on to their majorities in the House and Senate. Nothing succeeds like success, and regardless of how personally unpopular the president may be, if his policies are working, the voters are much more likely to keep his party in control on Capitol Hill. But we don't pursue prosperity primarily for political ends. We pursue it because it's good for people. These numbers are good. Now it's time to step it up to great.

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