Reuters reports: “U.S. Job Growth in January Disappoints”
The U.S. economy created just 112,000 new jobs in January, far fewer than expected, government data showed on Friday in a disappointing report that will likely weigh on President Bush’s re-election campaign.
The fifth straight monthly gain in payrolls outside the farming sector was the largest since December 2000, the Labor Department said. However, its report still showed weak hiring 26 months after the economy climbed out of recession.
“The payrolls number was well below market expectations and confirms the jobs market in the U.S. is weak,” said Daniel Tenengauzer, vice president for foreign exchange at Lehman Brothers.
Analysts had been expecting the economy, which has been showing strength in areas outside the jobs market, to add 150,000 new jobs in January . . . .
“This is the weakest job creation rate relative to economic growth on record,” said Steven Wood, an economist at Insight Economics.
The economy grew at a healthy 4 percent annual rate in the final quarter of last year after a soaring 8.2 percent pace in the previous three months.
January’s unemployment rate ticked down to 5.6 percent, the lowest in two years, from 5.7 percent in December. Analysts were looking for the unemployment rate to hold steady.
Here’s a graphic showing the breakdown of these stats by industry types:
You know, I usually find Reuters quite objective, and I guess they are objectively reporting the pessimistic views of others, but here this data is certainly susceptible of a more optimistic view. As the graph below indicates, we continue on a steady course of increase, just not as rapid as hoped. And the unusual fact that growth has been so strong while jobs are still viewed as lagging may be largely attributable to the unusually strong productivity increases, which are unquestionably good news in the longer term.
The unemployment rate is good news, as is the fact the jobs gain is “the largest since December 2000.”
And I wouldn’t shed too many tears for the drop in government employment unless I knew more precisely what kind of jobs were down. Theoretically, at least, it means savings on taxes and smaller government.
If you enjoyed this post, please consider leaving a comment or subscribing.
Subscribe by RSS
Subscribe by Email
Comments
No comments yet.
Leave a comment