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US Jobs Off to a Great Start to 2019: Sector ETF Winners

Sanghamitra Saha

U.S. employers added 304,000 new jobs in January, after a downwardly revised 222,000 in December. The number breezed past market expectations of 165,000. There was also an upward revision in November jobs data from 176,000 to 196,000. Considering all revisions, job gains have averaged 241,000 per month over the past three months.

The unemployment rate, however, increased to 4% last month from 3.9% in December and above market expectations of 3.9%. This points to tumults created by the government shutdown. Average hourly earnings rose by 3 cents to $27.56. Over the year, average hourly earnings increased 3.2%.

Winning Sector ETFs

Against this backdrop, investors can consider betting on ETFs that are the largest beneficiaries of the January jobs data report. Below we have highlighted some of these that will likely see smooth trading in the days ahead.

Leisure & Hospitality

Job gains in the leisure & hospitality industry were most prominent, with 74,000 new vacancies being filled in January. Within the industry, job creation in food services and drinking places (37,000) and in amusements, gambling, and recreation (32,000) deserve special mention. Over the year, the industry added 410,000 jobs.

Invesco Dynamic Food & Beverage ETF PBJ and Casino ETF VanEck Vectors Gaming ETF (BJK) may see some solid trading in the near term thanks to the January jobs report. 


Per tradingeconomics, about 52,000 jobs were created in the construction sector in the month. In the span of a year, the sector has generated about 338,000 jobs. Nonresidential (19,000) and residential (15,000) components of specialty trade contractors as well as heavy and civil engineering construction (10,000) and residential building (9,000) saw an uptick in job creation.

Obviously, such upbeat data makes us keep a close watch on Invesco Dynamic Building & Construction ETF PKB. The underlying index of the fund picks building and construction stocks on the basis of factors like growth, stock valuation and investment timeliness (read: Will the Rally in Homebuilder ETFs Continue?).


New job additions jumped by 42,000 in the sector in January,wherein ambulatory health care services and hospitals added a respective 22,000 and 19,000. These two segments have been creating solid jobs for three months in a row. The sector, overall, saw an annual increase of 368,000 jobs (read: 5 ETFs to Tap for February).


There were 27,000 job additions in transportation and warehousing in January. Within the industry, warehousing and storage saw 15,000 job growth and couriers and messengers saw another 7,000 additions.

Year over year, employment in transportation and warehousing rose by 219,000. This puts the spotlight on iShares Transportation Average ETF IYT and First Trust Nasdaq Transportation ETF FTXR.


There were 21,000 job additions in retail trade in January. Within the industry, porting goods, hobby, book and music stores saw 17,000 job additions. Retail trade employment increased by 26,000 over a year. January jobs reports thus put VanEck Vectors Retail ETF RTH and ProShares Online Retail ETF (ONLN) in focus (read: eBay vs. PayPal ETFs: Which to Pick After Q4 Earnings?).

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Invesco Dynamic Food & Beverage ETF (PBJ): ETF Research Reports
iShares Transportation Average ETF (IYT): ETF Research Reports
VanEck Vectors Retail ETF (RTH): ETF Research Reports
ProShares Online Retail ETF (ONLN): ETF Research Reports
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