The U.S. labor market softened in January—which pleased stock market investors rooting for future interest rate cuts. Nonfarm payrolls increased 110,000 in January—less than the market's consensus estimate of about 170,000 jobs. Unemployment edged up to 4.6 percent from 4.5 percent in December. The Household survey, which tracks job growth for broad racial and ethnic categories, was even more subdued, registering just 31,000 jobs.

But the real story lies beneath the headline number. Just look at the distribution of January's Household job gains:

	Total:	+31,000 (+0.02 percent)
	Hispanic	+90,000 (+0.45 percent)
	Non-Hispanic:	-59,000 (-0.05 percent)

Hispanics account for 13.8 percent of U.S. workers, but they dominated January job growth—receiving more than 100 percent of all new jobs. Non-Hispanic employment fell by 59,000.

(Because half or more Hispanic workers are foreign-born, we use this number as a proxy for the impact of immigration, which the Federal government, typically, makes no serious effort to track.)

Talk about displacement!

January marked the sixth month in a row in which Hispanic job growth exceeded that of non-Hispanics. The trends in Hispanic and non-Hispanic job growth, and the ratio of the two, are tracked in the following graphic:

In the past six years (January 2001-January 2007) Hispanic employment has increased by 4.103 million, or 25.5 percent, while non-Hispanic employment grew by 4.078 million, or 3.4 percent. The ratio of Hispanic to non-Hispanic job growth indices, which we call VDAWDI (the VDARE.COM American Worker Displacement Index) rose to a record 121.4 in January from 120.8 in December.

It gets worse. The Bureau of Labor Statistics recalculated Household Survey figures for December 2006 based on new population figures developed by the Census Bureau. The revisions reflect "adjustments to the estimates of net international migration and updated vital statistics information."

Total U.S. population rose by 321,000 after the adjustments. Hispanic population was bumped up by 188,000—equal to 59 percent of the total increase. The Hispanic presence was even more pronounced in the employment adjustments:

• Civilian labor force: Total +163,000  Hispanics: +133,000

• Employment: Total: +153,000 Hispanic: +124,000

Hispanics accounted for 82 percent of December's upward labor force adjustment, and 81 percent of the employment adjustment.

This obviously implies that December's original figures—which showed 6 of every ten jobs going to Hispanics—vastly understated the displacement of non-Hispanic workers.

Unfortunately, the revisions are not seasonally adjusted, and cannot be used to update to our monthly history.

In January, 2006, I wrote that the conventional view of the U.S. job market is that it

is neither hot enough to give the Fed an excuse for further rate hikes nor cold enough to raise the specter of recession. It's just right.

But obviously this "Goldilocks Effect" works best if you're Hispanic. Call it Ricitos de Oro.

Edwin S. Rubenstein (email him) is President of ESR Research Economic Consultants in Indianapolis.