The U.S. economy created a modest 157,000 jobs in January while the unemployment rate edged higher to 7.9 percent, consistent with a recovery that is just ambling along, at best.
The Labor Department's report Friday was about as expected, but despite its tepid results, it at least may dispel some worries about the economy after the poor showing in the fourth quarter.?
On Wednesday the government reported that the gross domestic product, the value of all goods and services produced by the nation, came to a standstill. Deep cuts in government spending and a big drawdown in inventories offset underlying strength in business and consumer spending.
?January's employment report should help to soothe any lingering concerns, after the negative GDP (data), that the U.S. economy is headed for a recession,? said Paul Ashworth, chief U.S. economist for Capital Economics.
The hiring picture over the past two years looked better after the department's annual revisions. Those showed employers added an average of roughly 180,000 jobs per month in 2012 and 2011, up from previous estimates of about 150,000. And hiring was stronger at the end of last year, averaging 200,000 new jobs in the final three months.
But the latest job numbers confirm what economists have been saying since the U.S. pulled out of one of the deepest recessions in a century: the pace of the recovery is too slow to make a big dent in the unemployment rate. Friday?s report showed the rate bumped up a tenth of a?point ? down from a peak of 10 percent in Oct. 2009.
Since then, the pace of job creation has been barely fast enough to keep up with population growth. More than four years after the recession ended, overall employment is still 3.1 million jobs lower than the peak reached in January 2008.
Until the pace of job creation picks up convincingly, the Federal Reserve will likely continue to buy roughly $85 billion of bonds each month to keep interest rates low and try to spur growth. That prospect has been helping push stocks near to new heights.
Central bank policy makers on Wednesday renewed their commitment to the easy-money policy, which they have pledged to keep in place until the jobless rate falls below 6.5 percent.
Forecasters say that, based on other reports on the economy?s strength, that target won?t be hit for at least another year.
?We haven?t seen anything in the data yet that suggests that job growth is about to pick up to an area that is satisfying to the Fed, said Julia Coronado, chief economist for North America at BNP Paribas.
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