Friday, February 3, 2012

Payroll Employment Jumps by 243,000, Dropping Unemployment Rate to 8.3%

Payroll unemployment grew 243,000 in January, exceeding expectations of 140,000 and dropping the unemployment rate to 8.3%. The private sector continued to drive job growth in January with widespread gains. The unemployment rate dropped 0.2 points to 8.3%, its lowest level since February 2009. Past reports were revised upward as well, with November’s growth revised from 100,000 to 157,000 and December’s revised from 200,000 to 203,000.

ABA’s chief economist James Chessen commented, “This is good news. It shows that the economic recovery has successfully transitioned into a self-sustaining economic expansion.”

January’s employment gains were broad based, across the private sector, which added 257,000 jobs. The service industry continued to see the largest gains, adding 162,000 jobs while the goods producing sector added 81,000 jobs. Specific industries seeing the largest boost in January were the professional and business services, leisure and hospitality, and manufacturing. Professional and business services added 70,000 jobs. Notably, the manufacturing sector added 50,000 jobs. The manufacturing sector has only added more than 50,000 jobs once since 1998.

Government continues to drag on growth, shedding 14,000 jobs in January.

The unemployment rate continues to drop, falling to 8.3% in January. Labor force participation fell to 63.7% in January. Although this isn’t directly comparable with last year due to revisions, it is the lowest level since the recession began. Factory workers recorded an average work week of 41.9 hours, the longest since January 1998.

The household portion of the data was revised to reflect 2010 Census data. The adjustment increased the estimated size of the civilian non-institutional population by 1.51 million, but left the unemployment rate unaffected. The labor force was revised higher by 258,000 and employment was revised up by 216,000.

Read the report.

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