• Wed
  • Jul 30, 2014
  • Updated: 3:51pm
BusinessEconomy
ECONOMY

US employment slows after holiday

PUBLISHED : Saturday, 08 February, 2014, 5:12am
UPDATED : Saturday, 08 February, 2014, 5:12am

Payrolls in the United States increased less than projected last month as retailers cut back after the holidays and government hiring fell. The unemployment rate unexpectedly declined to 6.6 per cent.

The 113,000 gain in employment in the world's biggest economy followed a revised 75,000 increase in December, labour department figures showed. The median forecast of economists in a survey called for a 180,000 advance.

The unemployment rate dropped to the lowest level since October 2008 even as more Americans entered the labour force.

Retailers and government agencies cut payrolls by the most in more than a year, while construction firms and manufacturers boosted employment.

Broad-based improvement in job growth is needed to help generate bigger wage gains and spur the consumer spending that accounts for almost 70 per cent of the economy.

"We're making progress but the progress is still slow," Stephen Stanley, the chief economist at Pierpont Securities, said before the report.

On many fronts, "the labour market isn't performing in a way that is satisfactory. We've had decent job growth but not a sustained period of strong job growth".

The report showed 262,000 Americans were not at work last month because of inclement weather, little changed from January last year, suggesting conditions played a more limited role than in December.

Last month, the labour department had said poor weather kept 273,000 people from work in December, the most for any December since 1977.

Unemployment fell from a post-recession high of 10 per cent, reached in October 2009.

"Companies will be more confident about making stronger investment in people and capital as the outlook continues to strengthen," said Carl Camden, the chief executive of Kelly Services.

Demand is improving for some companies, signalling employers will be encouraged to expand this year, according to the staffing services provider.

More than half the gain in last month's employment came from the construction and manufacturing industries, while payrolls among service producers slowed.

Revisions to prior reports added 34,000 jobs to overall payrolls in the previous two months.

Estimates of 92 economists in the survey for January employment ranged from gains of 105,000 to 270,000.

Private employment, which excludes government agencies, rose 142,000 after 89,000 in December.

The so-called participation rate rose to 63 per cent from 62.8 per cent.

Share

For unlimited access to:

SCMP.com SCMP Tablet Edition SCMP Mobile Edition 10-year news archive
 
 

 

 
 
 
 
 

Login

SCMP.com Account

or