Jobless rate hits 5-month
low but payrolls fall
WASHINGTON – The US unemployment rate surprisingly fell to a five-month low in January and factory payrolls grew for the first time since 2007, hinting at a labor market recovery even though the economy lost 20,000 jobs.
President Barack Obama cautiously welcomed the figures but said more needed to be done to put people back to work. Obama and his fellow Democrats fear voters could punish them in November congressional elections if headway is not made in tackling unemployment.
The decline in payrolls reported by the Labor Department on Friday was far smaller than the 150,000 drop posted in December. November’s data from the survey of employers was revised sharply higher to a gain of 64,000, up from 4,000.
The jobless rate, based on a separate household
survey, fell to 9.7 percent from 10 percent in December. That survey
found employment rising, with the size of the labor force roughly flat.
Analysts had expected payrolls to rise by 5,000 and the unemployment
rate to edge up to 10.1 percent.
“The wheels of the economy are turning. The improvement in the
employment data does match the increase in GDP the last two quarters so
it’s not a fluke. The economic recovery looks much more sustainable
today,” said Chris Rupkey, senior financial economist at Bank of
Tokyo/Mitsubishi UFJ in New York, referring to economic growth data for
the fourth quarter 2009.
Details of the report were relatively upbeat. The length of the average
workweek hit its highest in a year and overtime paid in manufacturing
was the most since September 2008, suggesting growing pressure to add
to payrolls.
Some analysts, however, were skeptical of the drop in the jobless rate
and believed it would head higher again. The pickup in factory
employment helped to lift US stocks, despite lingering worries about
European fiscal problems. (abs-cbn)
US government debt prices rose and the US dollar hit an 8-1/2 month
high versus the euro, tapping flight-to-quality trades from the
troubles in Europe.
Annual revisions to the payrolls data showed job losses since the
recession began were much deeper than originally thought. The economy
has lost 8.4 million jobs since the start of the recession in December
2007, compared to 7.2 million before the revisions.
In January, the number of ‘discouraged job seekers’ stood at 1.1
million, up from 734,000 a year ago. Last month, 6.3 million people had
been out of work of more than 27 weeks.
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