The U.S. labor market teed off the new year with a nice surprise as the country's unemployment rate dropped to a near three-year low of 8.3 percent in January, but experts believe that the jobs growth was insufficient to cure the lingeringly sick labor market in the short run.
UNEMPLOYMENT THREE-YEAR LOW
Payroll growth last month was matched with a decrease of the unemployment rate for the fifth consecutive month, adding to a recent string of positive economic data pointing to a stronger economic recovery.
The U.S. unemployment rate edged down to 8.3 percent last month from 8.5 percent in December 2011, a near three-year low since February 2009, as total U.S. nonfarm payroll employment rose by 243,000 in January, beating economists' expectations of about 150, 000, the Labor Department reported on Friday.
Customers rent cars at the Reagan National Airport in Washington D.C., Feb. 3, 2012. The U.S. unemployment rate edged down to 8.3 percent last month from 8.5 percent in December 2011, evidence of an improving job market, the Labor Department reported on Friday. (Xinhua/Fang Zhe)
Private-sector employment grew by 257,000 last month, but governments at all levels continued to trim 14,000 jobs against the backdrop of slashing government outlays.
"The latest payroll survey offers further evidence of a strengthening labor market," said Gary Burtless, a senior fellow with the Brookings Institution, adding that after showing little change over the first half of last year the jobless rate has now fallen 0.8 percentage point since last August.
WIDESPREAD JOB GROWTH
Across-the-board jobs growth in professional and business, leisure and hospitality, health care sectors, as well as upward revisions of earlier data contributed to the decline of the unemployment rate.
The number of newly created jobs for November 2011 was upwardly revised from 100,000 to 157,000, and that for December 2011 was revised from 200,000 to 203,000.
The latest job figures gave a boost to U.S. President Barack Obama who has geared up his reelection bid.
"The unemployment rate came down because more people found work. And altogether, we've added 3.7 million new jobs over the last 23 months," Obama said Friday in a speech after the release of the report when visiting a fire station in Virginia, urging Congress to take more steps to bolster the economic recovery and create jobs.
With the nation's shaky property market reversing the freefall decline trend starting the end of last year, employment in construction increased by 21,000 in January, following a gain of 31,000 in the previous month.
The other part of the job market story was that the nation's stubbornly high unemployment rate has hovered above 8 percent for three years and the share of long-term unemployed showed no noticeable decline over the past years, evidence of the structural problems in the labor market.
"There's welcome news in this latest jobs report as more Americans found work last month, but the fact is our unemployment rate is still far too high," U.S. House Speaker John Boehner, the top GOP congressman, said in a statement, adding that American people have seen the same story now for 36 straight months.
Some economists cautioned that there was still a long way from robust U.S. economic and labor market revival, as the faltering real estate market, sluggish wage growth pace and eurozone debt crisis spillovers were dimming the recovery outlook.
The U.S. economy might continue with the sub-par economic growth below its potential for several years, Nicholas Lardy, a senior fellow at the think tank Peterson Institute for International Economics, told Xinhua.
"The U.S. labor market started 2012 with fewer jobs than it had 11 years ago in January 2001 -- a testament to both the enormity of the current labor market crisis as well as the very weak job growth of the 2000-07 business cycle," contended Heidi Shierholz, an economist with the Washington-based Economic Policy Institute.
The share of the long-term unemployed workers who have been unemployed for more than 27 weeks rose to 42.9 percent in January from 42.5 percent a month earlier, and not far away from the peak of 45.5 percent in March 2011. Even at January's jobs growth rate, it would still take until 2019 to get the country back to full employment, Shierholz noted.
The worry is that the poor performing decades characterized by high unemployment and low growth will become the new normal of the 21 century, with disastrous consequences for future American generations, John Taylor, a renowned professor at Stanford University, cautioned in his new book "First Principles: Five Keys to Restoring America's Prosperity".