Employment Figures Underwhelm Yet Again

By Toni Vranjes

February 7, 2014

It’s a new year, which brings new hope — but unfortunately, hopes for stronger job growth haven’t been realized.

The Labor Department reported today that the economy added only 113,000 new jobs in January. The consensus among economists was that employment would rise by 181,000, according to IHS Global Insight.

down_arrow_6_pt_6In January, the unemployment rate dropped from 6.7 percent to 6.6 percent, while the labor force grew by about 500,000.

Employers added jobs in construction, professional and business services, leisure and hospitality, manufacturing, and other areas. Construction had an especially big increase, with employment gains of 48,000. In an analysis of the jobs report, IHS economist Doug Handler noted that the construction numbers were “a bounce back from December’s weather-influenced result.”

For December, the government’s revised jobs numbers show that employment grew by only 75,000. The January numbers were a “huge disappointment since we can no longer dismiss December’s poor numbers as an aberration,” Handler wrote. Nevertheless, he still expects economic growth to accelerate later this year.

On the White House blog, President Obama’s chief economist Jason Furman emphasized that the private sector has been creating jobs for nearly four years. Total employment in the private sector has increased by 8.5 million over the past 47 months, he wrote on the blog.

Furman also emphasized that the unemployment rate dropped 0.1 percentage point in January, as the labor-force participation rate increased 0.2 percentage point. However, he added that the jobless rate remains “unacceptably high,” noting the 3.6 million long-term unemployed Americans.

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