Resume review at the BostonHires job fair. (AP Photo/Steven Senne)
By Don Lee | The U.S. unemployment rate unexpectedly dropped to 9.7 percent in January from 10 percent in the prior month, but employers eliminated another 20,000 net jobs over the month, the government said today in a report that shows the labor market has yet to turn the corner despite the return of growth to the economy.
The January jobless figure was based on new population data from the Census Bureau, which complicates comparisons with the December employment statistics. The unemployment rate is calculated from a survey of about 60,000 households, using estimates of the population and the labor force – those who are working and looking for work.
The latest survey showed 541,000 more people as employed in January than the previous month, some of which probably reflects an increase in the self-employed and hiring by new firms that are often hard to capture during turning points in the economy. The overall labor force was roughly unchanged last month.
But the payroll jobs data were not particularly encouraging. These figures, which economists consider more reliable than the household report, are based on a survey of 160,000 businesses and government agencies. In addition to last month’s total net payroll decline of 20,000, the Bureau of Labor Statistics said the economy lost 150,000 jobs in December – 65,000 more than previously estimated.
What’s more, today’s report included revisions of prior payroll statistics, and that showed the recession was much more severe in destroying jobs than previously reported. The new figures indicate that the American economy eliminated 8.4 million jobs since the recession began officially in December 2007 – about 1.2 million more than initially estimated.
The good news is that job declines have moderated sharply, from a high of 753,000 monthly payroll losses on average in the first quarter of 2009 to an average monthly fall of 103,000 in the final quarter of last year — a trend that continued into January.
The latest January report also showed some hopeful signs. Although construction continued to cut payrolls, losing another 75,000 last month, manufacturing employment turned up slightly for the first time in many months. There were also net job gains in retail, health and education services and the temporary-help industry, which is seen as a harbinger of broader hiring.
Overall, the labor market remains weak, with some 6.3 million people who have been unemployed for six months or longer.
Analysts generally don’t see an immediate turnaround in the job outlook. In its January survey of small businesses nationwide, the National Federation of Independent Business said new firms being started may add some to the job figures, but companies already in existence are not creating jobs yet. Over the next three months, the survey said, more small employers are expecting to cut jobs than those planning to add to their payrolls.
Can you say “cooked numbers”?
Um….I don’t believe ANYTHING out of the BLS these days.
As an architect – unemployment is currently the worst it has ever been – some estimates are in the 40 to 50% range nationwide – may be a bit better or worse depending on where you are. I would like to see the U6 number and even that is dubious at best coming from BLS.
Hang on folks – we have a LONG way to go!!! I would not get my hopes up too high for the foreseeable future!!!
Most transparent government in history…. ?
Nice reporting! No mention that the real reason the unemployment rate “dropped” was the ever increasing millions of people who have given up looking for employment, let alone those who are significantly under-employed.
Democrats like Barney Fwank, Reid, Pelosi and Obama tanked the economy by ensuring every person who wanted a house could “own” one, even with no equity, savings or job (can you say Socialism?), and now these millions recognize that business has no desire to expand employment anytime soon with the heavy duty rules, regs and taxes the administration keeps pushing. Can’t wait for the next election.
It’s interesting to me to read people’s interpretations of the latest unemployment rate dropping to 9.7%. If you’re a Democrat, you’ll rub it into Republicans’ faces that the economy is improving under Obama. People are going back to work.
Several years ago when, under Bush, the country was coming out of a recession in 2001-2002, he was boasting about the improving job situation. Democrats threw cold water on that by saying good paying jobs were lost in favor of service-sector job which paid less.
Same is happening now. People are losing good paying jobs to temp jobs and other low paying service sector jobs. That’s where the job growth is at. People are returning to work but at reduced wages.
I watched the 2004 debates and listened to John Kerry and John Edwards speak. All they talked about were bringing jobs, good paying jobs, to America. Sounds good, but who will be paying those good paying jobs? Who can afford to? Dream on.
It’s interesting to me to read people’s interpretations of the latest unemployment rate dropping to 9.7%. If you’re a Democrat, you’ll rub it into Republicans’ faces that the economy is improving under Obama. People are going back to work.
Several years ago when, under Bush, the country was coming out of a recession in 2001-2002, he was boasting about the improving job situation. Democrats threw cold water on that by saying good paying jobs were lost in favor of service-sector job which paid less.
Same is happening now. People are losing good paying jobs to temp jobs and other low paying service sector jobs. That’s where the job growth is at. People are returning to work but at reduced wages.
I watched the 2004 debates and listened to John Kerry and John Edwards speak. All they talked about were bringing jobs, good paying jobs, to America. Sounds good, but who will be paying those good paying jobs? Who can afford to? Dream on.
You are a very smart person!
Thank you for a great post