The economy added 157,000 jobs this month and unemployment ticked up to 7.9%.
“This is where it gets confusing,” CNBC Brian Sullivan explained. “An upward tick in unemployment isn’t always a bad thing because it means that more people may be looking for a job. You’re only counted in this number if you’re actively looking for a job. As more people drop out of the work force, they give up even trying we can actually see unemployment tick down. So sometimes, before unemployment goes down permanently, you see an uptick, because people say ‘things are better, I’m going to get a job again’ and you see that number tick up.”
Sullivan noted that the number of discouraged workers in January—804,000—is a significant drop from a year before, when there were 1,054,000 discouraged workers.
“The number of people who are discouraged and think they can’t get a job has gone down significantly, which would explain the slight uptick in the unemployment rate,” he said.
Revisions to the December numbers, however, were the biggest news: 40,000 more jobs were added than initially predicted—a full 196,000 jobs were gained in December.
“It’s one of the biggest revisions I’ve seen in a long, long time,” Sullivan remarked.
Fortune Magazine’s Leigh Gallagher agreed that the numbers are good, but worried about the optics.
“I just hope the world will see it that way. Sometimes, the optics are what trumps everything,” adding that she sees some consumer pessimism. “We saw consumer confidence numbers drop a lot in January. I don’t want to be too pessimistic; I do think this is good, but the National Retail Federation just came out with its predictions for 2013 spending and its predictions are down.”
MSNBC contributor Ezra Klein noted that consumer confidence can be shaky, as “it’s tough to establish causality,” but returned to the previous month’s revisions as the highlight of the report.
“These revisions frankly matter more than the number for this month, because they’re just more accurate,” he said. “The November revision is up from 161,000 to 247,000, it’s gone up almost a hundred thousand.”
He continued: “In this jobs report, the headline isn’t the 157,000 jobs added in January, it’s that we’ve added a hundred thousand, a couple hundred thousand jobs in revisions over the last two months.”