Unemployment at 7.9 percent in JanuaryPosted on
The economy added 157,000 jobs in January and the unemployment rate ticked up to 7.9 percent, the federal Bureau of Labor Statistics reported today.
Retail trade, construction, health care and wholesale trade added jobs during the month, the government said, and the number of unemployed people, at 12.3 million, was little changed. The department said the jobless rate, which rose 0.1 percent, has been at or near its current level since September.
The modest employment growth — and gains in the prior two months that were larger than initially reported — support opinions that the economy’s sluggish recovery is on track despite a surprise contraction in the fourth quarter of last year, Reuters said in analyzing today’s jobs numbers. There were 127,000 more jobs created in November and December than previously reported.
The closely watched report also showed an increase in hourly earnings and solid gains in construction and retail employment.
“This is actually a really good number when you take into account the net upward revision,” Terry Sheehan, an economic analyst at Stone & McCarthy Research Associates in Princeton, N.J., told Reuters.
Coming on the heels of data Wednesday that showed a surprise contraction in gross domestic product in the fourth quarter, the report should ease fears that the economy was at risk of a recession, even though the unemployment rate ticked up, Reuters said.
Federal Reserve officials said Wednesday that economic activity had “paused,” but they signaled optimism that the recovery will regain speed with continued monetary policy support. The Fed left in place a monthly $85 billion bond-buying stimulus plan.
“This shows that underneath the surface, the fourth-quarter economy was really pretty good despite all the defense cuts. I think the private sector is leading the way,” Jack Ablin, chief investment officer at BMO Private Bank in Chicago, told Reuters.
Economists polled by Reuters had expected employers to add 160,000 jobs and the unemployment rate to hold steady at 7.8 percent last month.
The Labor Department also published benchmark revisions to payroll data going back to 2008. It said the employment level in March 2012 was 422,000 higher on a seasonally adjusted basis than previously reported.