Read our full analysis for a more in-depth look at these trends.
The Institute Employment Report: January 2026
Jobs growth strengthened to 0.8% YoY in January, according to Bank of America internal data.
February 2026
Key takeaways
- An estimate of payrolls based on Bank of America internal data shows a further improvement in year-over-year (YoY) growth in January, to 0.8% YoY. At the same time the growth in the number of households receiving unemployment benefits dipped slightly in January, to 9% YoY. Overall, the impression is of a stabilizing, and possibly re-accelerating, labor market.
- According to Bank of America internal deposit data, there remains a large gap between the after-tax wage and salary growth of higher- and lower- income households. In January, higher-income households’ after-tax wage and salary growth was 3.7% YoY, while for lower-income households it was 0.9% YoY.
- Middle-income households’ wage growth, in our view, deserves close attention. These households’ after-tax wage growth was 1.6% YoY in December, tracking below the average of 2.0% YoY seen over the second half of 2025. This relative softness may unwind, but if it persists it may lead to downside risks to consumer spending once the expected lift from tax refunds is over.
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