People who bet on a slowdown in the U.S. job market lost again last month.

The economy added 353,000 jobs in January, the Bureau of Labor Statistics said Friday. That’s nearly double what economists expected and well above the already-respectable monthly average of 255,000 for 2023. Wages also grew a stronger-than-expected 4.5%, and the jobless rate stayed in a tight range at 50-year lows.

“The labor market is the little engine that could,” said John Leer, chief economist at the business intelligence firm Morning Consult.

The White House leaned into the numbers, as President Joe Biden seeks re-election this year. Officials view the data as vindication of Biden’s policies, such as passage of the Inflation Reduction Act and investments in semiconductors and science. Jared Bernstein, chairman of the president’s Council of Economic Advisers (CEA), called the report an “unequivocal story” that is good for the overall economy and working families.

“With easing inflation, we’ve now got wages handily beating prices, meaning more buying power,” Bernstein told reporters after the report was released Friday. “This is at the heart of a very virtuous ongoing cycle where the tight job market, strong job gains and wage growth outpacing price growth is consistently boosting consumer spending.”

To be sure, while consumer sentiment has improved recently, approval of the president’s handling of the economy is low. 

The overall strength in the job market also complicates the work of the Federal Reserve, which has raised interest rates to tamp down inflation. With the economy still strong, the central bank will likely wait longer to cut rates, delaying relief for consumers saddled with high credit card balances and mortgage rates.

“There is absolutely no sign of a softening labor market or weakening wage pressures,” says Seema Shah, chief global strategist for Principal Asset Management.

Still, White House economic advisers hope a sustained period of strong wages and slowing inflation will help household budgets and continue to show up in improving sentiment indicators.

Likewise, Leer thinks strong jobs growth, rising wages and falling inflation make the outlook for consumer spending this year “encouraging.”

“So encouraging that it feels less appropriate to cut interest rates before seeing some evidence of a moderation in economic activity,” he said.

Indeed, the cooling that economists and CEOs had forecast hasn’t materialized. On the contrary, the January jobs report shows an acceleration in hiring. The government also revised December’s report higher, bringing the two-month job gain to nearly 700,000.

“The dramatic upside surprise to both jobs and wage growth means that a March rate cut must be off the table now, and a May cut is also now potentially on ice,” said Shah.

The CEA’s Bernstein, in turn, noted that the Fed’s favored measure of inflation has fallen to a key point.

“If you look at the core PCE [personal consumption expenditures], it’s trending at 2% for the last six months of last year. So that is very consistent with the easing inflation story that we’ve been focused on here,” he said.

Still, advisers are keenly aware of higher grocery bills hurting the consumer’s psyche. Inflation rates may be slowing, but price levels are still higher today than before the inflation surge, something that until recently may account for poor sentiment and poll numbers for Biden.

Meanwhile, his likely GOP challenger in November, former President Donald Trump, has begun to test out his rebuttal to the recent run of strong economic news.

On Fox Business on Friday, he said the stock market is at record highs because investors “think I am going to get elected.”

He also downplayed a so-called soft landing in the economy, predicting a spike in oil prices because of unrest in the Middle East that he says could reignite inflation. He also said he would not reappoint Jerome Powell as Fed chief, saying if the central bank cuts interest rates, it will help Democrats.

Friday’s blowout jobs report showing 353,000 jobs added in January versus expectations for 185,000 jobs is another signal that the U.S. economy remains strong.

But that good news also likely confirms the view of policymakers at the Federal Reserve that there is no rush to begin cutting interest rates, meaning the cost of borrowing for consumers — perhaps to buy a car or a house — will likely stay elevated for some time.

Earlier this week, the Fed announced it was leaving the current federal funds rate, which helps set interest rates for loans throughout the economy, unchanged at 5.25% to 5.5%.

In remarks after the announcement, Fed Chair Jerome Powell said he thought it was unlikely that the first rate cut of the post-pandemic period would come in March, as some investors were hoping. Inflation, he said, remains too hot — even at 3.4%. The central bank wants to get it back down to 2%.

“We are prepared to maintain the current target range for the federal funds rate for longer, if appropriate,” he said, referring to that 5.25% to 5.5% range.

In a note to clients after Friday’s jobs report, Seema Shah, chief global strategist at Principal Asset Management, said the data showed ‘there is absolutely no sign of a softening labour market or weakening wage pressures,’ meaning that despite thousands of layoffs in industries such as tech and media recently, other job sectors are still going strong.

As a result, a March rate cut is off the table, Shah predicted, adding that a cut in May, when the Federal Open Markets Committee will deliver its third interest rate decision of the year, also now seems to be ‘on ice.’

‘Certainly, with this kind of number,’ she said, referring to Friday’s jobs report, ‘the six or seven rate cuts that markets had been pricing in seems very offside.’

Following the release of Friday’s jobs report, financial market traders increased their odds of the Fed maintaining its current rate through May from just 6% to 27%, while the odds of the current rate staying the same through March climbed from 62% to 80%.

The latest jobs data was not without some red flags for monetary policymakers. One of them is the acceleration in average hourly earnings with no corresponding change in hours worked.

If those trends continue, it could even be a sign of stagflation: higher prices but slower economic growth.

“This would be wonderful if inflation were at its target,’ Sean Snaith, a University of Central Florida economist, wrote in a note Friday. ‘But now it means the current the Fed is swimming against just got stronger, and it’s going to be harder to get upstream,’ he said. While inflation has fallen dramatically since it peaked at 9.1% in June 2022, it has lingered stubbornly in the 3% range for the past seven months.

The jobs report also saw the continued trend in low survey response rates, as well as effects from severe winter weather, both of which may have skewed the numbers somewhat.

Still, the consensus among economic analysts is that higher interest rates are here to stay, for the time being.

‘The much stronger than expected January jobs report, including upward revisions to job growth in previous months and a big increase in wages, makes a near-term cut in the fed funds rate less likely,’ Gus Faucher, chief economist at PNC, wrote in a note to clients Friday.

Federal Open Markets ‘Committee members will be concerned that strong job and wage growth in late 2023 and early 2024 could reignite inflationary pressures in the U.S. economy,’ he continued.

The upshot of it all: It is unlikely there will be a major change in borrowing rates anytime soon.

Disney has updated the language on its three streaming platforms to limit password sharing outside of a user’s individual account.

In an email to subscribers sent Wednesday, Disney-owned Hulu said it would begin limiting account sharing for prior and existing subscribers starting March 14, with the changes effective for new subscribers as of last week.

Disney+ and ESPN+ have also both updated their user agreements to reflect the changes to account sharing, though it was not immediately clear when those changes occurred. The new language was first reported by CNN.

A Disney representative did not immediately respond to a request for comment. Disney CEO Bob Iger hinted at the move to limit account sharing on a company earnings call last August.

“In calendar ’24, we’re going to get at this issue,” Iger said. “We certainly have established this as a real priority. We actually think that there’s an opportunity here to help us grow our business.”

An effort to cut down on users improperly sharing Disney+ accounts in particular helps to bolster Iger’s stated goal to make the streaming service profitable by the end of 2024.

The moves follow Netflix’s announcement last April that it would begin making users pay more if they wanted to share accounts. Netflix said last month it just saw its highest-ever quarterly subscriber growth.

Taxpayers are facing higher costs to file their returns this year. Some will find relief from a new government tool. Many won’t.

The costs of tax return preparation and other accounting fees rose 8.3% — steeper than the current 3.4% inflation rate — between November 2023 and the same month the year before, the latest federal data show. That category reflects the growing costs of using DIY tax software and of hiring an accountant.

Many tax preparation firms, like other employers, have had to offer higher pay to attract workers in an industry short on accountants as fewer college students pursue accounting degrees.

“A lot of older preparers are retiring [and] the client base is expanding, so we need to hire more staff,” said Atiya Brown, a certified public accountant and owner of Dallas, Texas-based The Savvy Accountant. She estimates she and her peers have raised prices by 7% to 12% to offset higher costs for labor and software.

The average cost for filing an individual return rose to $248 in 2023 from $213 in 2021, a study released in August by the National Association of Tax Professionals shows, basically in line with government data tracking price increases for these services.

It isn’t unusual for preparers to raise rates, though the impact on consumers can vary widely; some accountants charge a fixed hourly rate, while others set a minimum fee with added costs for more complex returns.

The NATP survey found 49% of tax professionals increase prices annually. About 37% of those who hiked their rates did so mainly to “stop giving away as much free work,” with 16% saying they were “at capacity and need to slow on-boarding of new clients.”

Some of the most popular DIY filing tools are getting more expensive, too.

H&R Block’s desktop software options this year range from $25 for preparing “basic” returns to $75 for its “premium” offerings, like those capable of handling taxes on rental property. Those two are up by $5 and $10, respectively, since last year. Later this tax filing season, prices across all of its plans will rise by another $10.

“We delayed it as long as we could,” an H&R Block spokesperson said, citing higher costs for distribution and development, adding that this year is the company’s first price increase in over a decade.

TurboTax has kept its pricing unchanged from a year ago, but that will only last a few more weeks.

Its desktop software tools, which range from $40 for filing “basic” returns to $105 for “premier” offerings, remain above H&R Block’s pricing. And they’ll also be going up by $10 later this tax season — a common practice that both companies typically advertise prominently, looking to lure customers to file early.

Both H&R Block and TurboTax offer free online filing services for simple returns. But itemized deductions and slightly more complicated tax situations often require paying for upgraded features. And as many tax filers are reminded each year, both companies’ “basic” software options cover only federal taxes, with state filings tacking on another $40 apiece.

Alex Knight, 44, turned to a “free” option to file his taxes last year, only to find the charges adding up to more than $140 for including taxes on an investment account.

“It was just so esoteric and bizarre,” he said, “having all these materials, investing all the time, and, ‘Oh, by the way, this is going to cost you money.’”

Knight, who lives in a Brooklyn, New York, and works at an streaming audio company, said he’s just going to hire an accountant this year, his first time filing jointly with his wife. He expects to pay around $300 to $350.

“It’s frustrating, too, that this is something you have to go through a private company to do,” he added.

The government hopes to change that. The Internal Revenue Service is now offering Direct File, a new option allowing many taxpayers to file straightforward federal returns for free.

It’s launching this year as a pilot program in a dozen states — Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming — and will roll out incrementally through mid-March. Many eligible taxpayers will be able to use Direct File to submit state taxes for free, too.

In Arizona, for example, full-time residents with simple returns — largely those with common income sources and limited claims like the child tax credit — can use Direct File to file both their state and federal returns at no cost, said Rebecca Wilder, a communications director for the Arizona Department of Revenue.

“We’re always looking for ways to make filing taxes easier and more seamless, and so it just made sense for us to jump onto a pilot program that was already underway,” Wilder said, adding that Arizona hopes to expand eligibility to other types of taxpayers.

The IRS already offers Free File, which steers people with annual incomes of $79,000 or less toward third-party software they can use for free.

Major tax software providers have slammed Direct File, which threatens to eat into their customer base, saying their offerings help filers maximize their refunds.

“The mission of the IRS is to collect as much revenue as possible to fund the federal government — not to guarantee that Americans get their maximum refund and best outcome at tax time,” the H&R Block spokesperson said.

A TurboTax spokesperson bashed Direct File as a “thinly veiled scheme where billions of taxpayer dollars will be unnecessarily used to pay for something already completely free of charge today.”

The IRS didn’t respond to a request for comment.

TurboTax netted its parent company, Intuit, over $4 billion in revenue in the 2023 fiscal year. At H&R Block, where assisted tax preparation drives most of its business, DIY products brought in over $300 million in revenue last fiscal year.

Last week, the Federal Trade Commission issued an opinion finding TurboTax engaged in “deceptive advertising” by promoting its tax products as free, even though many customers who are drawn to its no-cost product, like Knight, get hit with charges while using it. The regulator ordered the company to stop making what it said were misleading claims about who’s eligible for its free tier.

TurboTax contends it has “always been clear, fair, and transparent with its customers,” and said it doesn’t expect any significant impact to its business from the FTC’s move.

Taxpayers are facing higher costs to file their returns this year. Some will find relief from a new government tool. Many won’t.

The costs of tax return preparation and other accounting fees rose 8.3% — steeper than the current 3.4% inflation rate — between November 2023 and the same month the year before, the latest federal data show. That category reflects the growing costs of using DIY tax software and of hiring an accountant.

Many tax preparation firms, like other employers, have had to offer higher pay to attract workers in an industry short on accountants as fewer college students pursue accounting degrees.

“A lot of older preparers are retiring [and] the client base is expanding, so we need to hire more staff,” said Atiya Brown, a certified public accountant and owner of Dallas, Texas-based The Savvy Accountant. She estimates she and her peers have raised prices by 7% to 12% to offset higher costs for labor and software.

The average cost for filing an individual return rose to $248 in 2023 from $213 in 2021, a study released in August by the National Association of Tax Professionals shows, basically in line with government data tracking price increases for these services.

It isn’t unusual for preparers to raise rates, though the impact on consumers can vary widely; some accountants charge a fixed hourly rate, while others set a minimum fee with added costs for more complex returns.

The NATP survey found 49% of tax professionals increase prices annually. About 37% of those who hiked their rates did so mainly to “stop giving away as much free work,” with 16% saying they were “at capacity and need to slow on-boarding of new clients.”

Some of the most popular DIY filing tools are getting more expensive, too.

H&R Block’s desktop software options this year range from $25 for preparing “basic” returns to $75 for its “premium” offerings, like those capable of handling taxes on rental property. Those two are up by $5 and $10, respectively, since last year. Later this tax filing season, prices across all of its plans will rise by another $10.

“We delayed it as long as we could,” an H&R Block spokesperson said, citing higher costs for distribution and development, adding that this year is the company’s first price increase in over a decade.

TurboTax has kept its pricing unchanged from a year ago, but that will only last a few more weeks.

Its desktop software tools, which range from $40 for filing “basic” returns to $105 for “premier” offerings, remain above H&R Block’s pricing. And they’ll also be going up by $10 later this tax season — a common practice that both companies typically advertise prominently, looking to lure customers to file early.

Both H&R Block and TurboTax offer free online filing services for simple returns. But itemized deductions and slightly more complicated tax situations often require paying for upgraded features. And as many tax filers are reminded each year, both companies’ “basic” software options cover only federal taxes, with state filings tacking on another $40 apiece.

Alex Knight, 44, turned to a “free” option to file his taxes last year, only to find the charges adding up to more than $140 for including taxes on an investment account.

“It was just so esoteric and bizarre,” he said, “having all these materials, investing all the time, and, ‘Oh, by the way, this is going to cost you money.’”

Knight, who lives in a Brooklyn, New York, and works at an streaming audio company, said he’s just going to hire an accountant this year, his first time filing jointly with his wife. He expects to pay around $300 to $350.

“It’s frustrating, too, that this is something you have to go through a private company to do,” he added.

The government hopes to change that. The Internal Revenue Service is now offering Direct File, a new option allowing many taxpayers to file straightforward federal returns for free.

It’s launching this year as a pilot program in a dozen states — Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming — and will roll out incrementally through mid-March. Many eligible taxpayers will be able to use Direct File to submit state taxes for free, too.

In Arizona, for example, full-time residents with simple returns — largely those with common income sources and limited claims like the child tax credit — can use Direct File to file both their state and federal returns at no cost, said Rebecca Wilder, a communications director for the Arizona Department of Revenue.

“We’re always looking for ways to make filing taxes easier and more seamless, and so it just made sense for us to jump onto a pilot program that was already underway,” Wilder said, adding that Arizona hopes to expand eligibility to other types of taxpayers.

The IRS already offers Free File, which steers people with annual incomes of $79,000 or less toward third-party software they can use for free.

Major tax software providers have slammed Direct File, which threatens to eat into their customer base, saying their offerings help filers maximize their refunds.

“The mission of the IRS is to collect as much revenue as possible to fund the federal government — not to guarantee that Americans get their maximum refund and best outcome at tax time,” the H&R Block spokesperson said.

A TurboTax spokesperson bashed Direct File as a “thinly veiled scheme where billions of taxpayer dollars will be unnecessarily used to pay for something already completely free of charge today.”

The IRS didn’t respond to a request for comment.

TurboTax netted its parent company, Intuit, over $4 billion in revenue in the 2023 fiscal year. At H&R Block, where assisted tax preparation drives most of its business, DIY products brought in over $300 million in revenue last fiscal year.

Last week, the Federal Trade Commission issued an opinion finding TurboTax engaged in “deceptive advertising” by promoting its tax products as free, even though many customers who are drawn to its no-cost product, like Knight, get hit with charges while using it. The regulator ordered the company to stop making what it said were misleading claims about who’s eligible for its free tier.

TurboTax contends it has “always been clear, fair, and transparent with its customers,” and said it doesn’t expect any significant impact to its business from the FTC’s move.