January jobs data beats estimates, but mortgage rates barely budge

We got the first jobs report of the year, and it was so strong that the number of jobs created in January is almost more than all of the jobs created in 2025! At first glance, that might seem like the jobs data had a heroic beat of estimates, but the reality is that while the jobs numbers did beat estimates — coming in at 130,000 — we also only created 181,000 jobs in all of 2025! It’s a strange labor economic cycle but when the bar is so low, anything normal is an epic feat these days. 

With that said, bond yields did shoot up at first with the 10-year yield, but as the day moved on, yields started to fall and mortgage rates only went up a smidge.

From BLS: Total nonfarm payroll employment rose by 130,000 in January, and the unemployment rate changed little at 4.3 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care, social assistance, and construction, while federal government and financial activities lost jobs.

Simply put, normal job creation levels of the past are now looked at as big beats. The last two job numbers have been positive and they’re being looked at as big job beats and that has lowered the unemployment rate to 4.3%.

Below is a breakdown of the jobs report this month. It echoes what has pretty much been the theme for a while now: without healthcare and social assistance creating jobs, our job creation data would have been negative for some time.

We aren’t getting much growth in the labor side of residential construction — things might not be getting worse, but this is still a negative trend.

The 10-year yield shot up higher after the report, but the 10-year yield has slowly gone lower throughout the day, and since mortgage spreads are good this year, we didn’t get much movement on mortgage rates. Mortgage News Daily quoted only a 0.03% hit on rates today with mortgage rates reaching 6.14%.

All in all, the report for this month was a positive — but positive in the sense that things didn’t get worse, and who knows what the future revisions will do to this report. However, this year we are working from the lowest bar ever for job growth and it’s pretty much just two sectors pushing the labor data for a year now.

For the yields (and mortgage rates) to make a considerable move higher, the labor data needs to show not only more jobs created but more jobs with breadth. The same is true for yields and rates to go lower: jobless claims would need to break and we need to see more job losses before the Fed takes notice. Next up is the CPI inflation report on Friday.