157,000 U.S. Jobs Added in January Shows Slow Growth
The US jobs market muddled along in January, with slower job growth and an uptick in unemployment, but underlying momentum was surprisingly stronger, official data showed Friday.
Employers added 157,000 jobs, down from December's upwardly revised 196,000, the Labor Department said.
The jobless rate rose to 7.9 percent from 7.8 percent, hovering at the same level since September, AFP reported.
The disappointing January results -- 180,000 jobs and a 7.7 percent jobless rate were expected -- were offset by a sweeping annual revision of earlier data that revealed stronger jobs growth throughout last year despite worries about the looming year-end fiscal cliff.
That view propelled US stocks higher as investors took comfort in the idea that the Fed will have to keep its short-term interest rates near zero, keeping downward pressure on longer-term rates.
The data helped propel the Dow Jones Industrial Average to above 14,000 for the first time since October 2007. At the closing bell, the blue-chip Dow was up 149.21 points (1.08 percent) at 14,009.79.
"The US stock market likes weak labor reports, and so the upward trend of stock prices remains intact. The reason is simple: weaker employment reports mean a longer period of time before the Federal Reserve changes its interest-rate policy," said David Kotok of Cumberland Advisors.
In 2012, the Labor Department said, employers added on average 181,000 jobs a month, well above the prior estimate of 153,000 jobs.
"The job market is healthier than we had previously thought," said Jason Schenker of Prestige Economics. "The outlook is positive and one of increased growth in the year ahead."
The revisions, despite a slump in capital investment and the economy's unexpected 0.1 percent fourth-quarter contraction, "highlight even more how remarkably resilient the US labor market has been over the last two quarters," said Harm Bandholz of UniCredit.
The White House said the latest data showed further healing from the worst recession since the Great Depression, but "more work needs to be done."
"Today's report is a reminder of the importance of the need for Congress to act to avoid self-inflicted wounds to the economy," Alan Krueger, head of President Barack Obama's Council of Economic Advisers, said in a statement.
Bitterly divided political leaders have until March to reach a deal to avoid automatic across-the-board federal spending cuts.
In January, the private sector added jobs for the 35th straight month, at 166,000 jobs. Government jobs fell by 9,000.
Significant gains came in retail trade, construction and health care, while transportation and warehousing jobs slipped.
Economists said the upturn in housing and reconstruction after Hurricane Sandy pointed to more gains in construction jobs.
There was little change in manufacturing employment, which has been essentially flat since last July.
The number of unemployed, based on a separate household survey from the one producing the job creation numbers, rose by a little more than 100,000, to 12.33 million.
The employment-population ratio and the civilian labor force participation were essentially unchanged.
The January uptick in unemployment reaffirmed the Federal Reserve's ultra-loose monetary policy to support the tepid recovery, analysts said.
"While the Federal Reserve won't be happy to see job growth slow, the rise in the unemployment rate validates their plans to keep monetary policy easy for the foreseeable future," said Kathy Lien of BK Asset Management.