U.S. adds 243,000 jobs in January

People wait in line during a job fair for Home Depot on Thursday in Tigard, Ore.
People wait in line during a job fair for Home Depot on Thursday in Tigard, Ore. (RICK BOWMER / Associated Press)
Posted: February 04, 2012

An "unambiguously good" jobs report from the U.S. Department of Labor sent stocks soaring Friday and likely will boost President Obama's political prospects.

The economy created 243,000 jobs in January. The unemployment rate dropped to 8.3 percent from 8.5 percent the previous month and 9.1 percent a year ago.

"There are no real caveats to those numbers," said Kurt Rankin, an economist with PNC Financial Services Group in Pittsburgh, who described the report's numbers as "unambiguously good.

"They went up across the board," said Rankin.

Expanded hiring in manufacturing, where payrolls increased by 50,000 in January on top of months of general job growth, led to hiring in the service sector, including business and professional services, which added 70,000 jobs, the biggest gainer.

That category, which includes accounting, computer design, law, and engineering, derives some of its strength from serving manufacturing companies, Rankin said.

The Dow Jones industrial average shot 160 points higher, to 12,865, in the first hour of trading. That is 55 points higher than its highest close since the financial crisis struck in the fall of 2008. The Dow closed the day at 12,862.23, up 156.82.

The jobs report "fuels a more optimistic climate for the president, and incumbents in general benefit from a sense that the economy is moving in the right direction," said political science professor Chris Borick, director of the Muhlenberg College Institute of Public Opinion.

"The economy is everything," Borick said.

Obama enjoyed a boost in poll ratings last winter, when positive job growth seemed to indicate the economy was strengthening. But as job growth slipped over the summer, so did Obama's ratings, Borick said.

Rankin said that consumers and businesses "are increasingly able to tune out the white noise" of fractiousness in Washington and the constant ups and downs of world economic news.

That will lead, he said, to an increased willingness to spend, invest, and hire.

The Labor Department revised recent payroll statistics upward, from 100,000 to 157,000 in November and 200,000 to 203,000 in December.

Friday's numbers, while good, don't seem to square with recent headlines.

On Thursday, pharmaceutical giant AstraZeneca, based in London and with facilities in Wilmington and Newark, Del., said it would cut 7,300 jobs worldwide, but spare most jobs in Delaware. And in January, its competitor, Pfizer Inc., laid off 88 pharmacists and nurses employed at its Collegeville facility.

First Niagara Bank, which runs 360 branches, including 60 in the area, laid off assistant branch managers.

And the Philadelphia School District eliminated 91 school police jobs Friday in a cost-cutting move.

Indeed, government hiring around the nation continues to decline, with most of the cuts at the federal and municipal levels. In January, 9,600 education jobs were slashed, part of a 14,000-job decline in government payrolls.

Those 14,000 jobs offset the 257,000 added in the private sector.

While most sectors added jobs, cuts continued in the information and finance sectors. Jobs were lost in publishing and motion pictures, as well as in credit activities, securities, and leasing services.

Friday's report came at a time when Congress is debating whether to extend payroll-tax cuts and continue federal unemployment benefits, which will begin to expire at the end of the month.

The average length of unemployment is 40.1 weeks, or just more than nine months. That's down from 40.8 weeks in December, but up from 37.1 weeks in January 2010.

There were 12.8 million unemployed in January, down from 13.9 million a year ago.

Of the 12.8 million jobless, 5.5 million, or 42.9 percent, were unemployed more than six months.

The unemployment rate incorporating discouraged workers and people forced to work part-time because they can't find full-time work was 15.1 percent in January, down from 16.1 percent a year ago.

Even as she lauded the report's good news, Christine Owens, executive director of the National Employment Law Project, said in a statement that "the labor market still has a long way to go to be able to accommodate the millions of Americans hungry for a job, and the crisis for the long-term unemployed persists."

Contact staff writer Jane M. Von Bergen at 215-854-2769, jvonbergen@phillynews.com, or @JaneVonBergen on Twitter.

This article includes information from the Associated Press.

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