- The unemployment rate rose a notch in January, up to 7.9 per cent from 7.8 per cent, the Bureau of Labor Statistics said today. Economists had expected the jobless rate to hold steady.
- The number of new jobs created, which is collected in a different survey, came in at 157,000, only narrowly below the consensus forecast of a 165,000 gain.
- On the plus side, though, most of the employment growth came from the private sector and was widespread across industries. Retail topped the charts in terms of new payrolls, but the construction sector also put in a strong showing, with 28,000 new jobs, a sign that the housing market is recovering.
- Public-sector employment, on the other hand, shrunk (-9,000 jobs), especially at the local government level.
- In another bit of good news, job creation estimates for the period between April 2011 and March 2012 was revised up by some 422,000 jobs, higher than the preliminary estimate of 386,000.
What the analysts are saying:
- Hiring in the private sector is a good sign, wrote RBC’s Paul Ferley, but the pace of job creation isn’t yet sustained enough to bring down the unemployment rate.
- With the January jobs report containing both good and not-so-good news, wrote CIBC’s Andrew Grantham, there’s little reason to believe the Fed will scale down its bond-buying program any time soon.
- TD’s Beata Caranci predicts the economy will add two million new jobs in 2013, roughly as many as it created in 2012, but that the first six months will be slow, with a pick-up in the second-half of the year. It would certainly help, she wrote in a note to clients this morning, if Congress and the Administration managed to pass the budget and find a definitive agreement on spending cuts and the debt-ceiling. Fiscal uncertainty is depressing business investment, which in turn slows down private-sector job creation.