Unemployment Rate Falls to 9.7% in January

 

February 5, 2010 

 

The unemployment rate fell to 9.7% in January from 10.0% in December and a high of 10.1% in October. The household measure of unemployment showed job gains of 541,000 in January which was partially offset by an increase in the civilian workforce of 111,000. However, the duration of unemployment continues to increase with the average duration increasing to 30.2 weeks in January from 29.1 weeks in December. The number of long-term unemployed people, those who have been unemployed greater than 27 weeks, also continued its upward trend in January reaching 6.3 million people or over 42% of those unemployed are long term unemployed. Since the beginning of the recession in December 2007, the number of long term unemployed people has increased by 5.0 million people.

 

The establishment survey showed job losses of 20,000 in January after losses of 150,000 in December. Job losses continue to abate with the 3-month average job loss now at 35,000, much lower than the 779,000 job loss in January 2009. The underlying details of the report showed additional strength with many industries showing job gains. Temporary help increased by 52,000 jobs in January and retail jobs increased by 48,000 jobs. The manufacturing sector showed gains of 11,000 jobs in January, the first gain since January 2007. Construction continued to lose jobs with a decrease of 75,000 jobs in January, as well as job losses in the financial sector (-16k), leisure and hospitality (-14k), and government jobs (-8k).

 

Average hourly earnings increased 0.3% in January and have increased 2.5% over the last year. The average weekly hours increased 0.1 hours in January to 33.3 hours from 33.2 hours in December.

 

Kristin Brewer

Senior Portfolio Manager