U.S. Unemployment Report Sends Mixed Signals in January

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Because the U.S. housing market is driven by jobs, today the marketplace received mixed signals for aiding in any possible real estate recovery in 2011.

According to the U.S. Bureau of Labor Statistics, the unemployment rate fell by 0.4 percentage point to 9.0 percent in January, while nonfarm payroll employment changed little (+36,000). Employment rose in manufacturing and in retail trade but was down in construction and in transportation and warehousing. Employment in most other major industries changed little over the month.

Even though the U.S. unemployment rate dropped in January, the fact that only 36,000 jobs were added was a disappointing statistic by many analysts, thus giving the marketplace mixed signals.



The unemployment rate (9.0 percent) declined by 0.4 percentage point for the second month in a row. The number of unemployed persons decreased by about 600,000 in January to 13.9 million, while the labor force was unchanged.

Among the major worker groups, the unemployment rates for adult men (8.8 percent), whites (8.0 percent), and Hispanics (11.9 percent) declined in January. The unemployment rates for adult women (7.9 percent), teenagers (25.7 percent), and blacks (15.7 percent) were little changed. The jobless rate for Asians was 6.9 percent, not seasonally adjusted.

The number of job losers and persons who completed temporary jobs fell from 8.9 to 8.5 million in January. The number of long-term unemployed (those jobless for 27 weeks or more) edged down to 6.2 million and accounted for 43.8 percent of the unemployed.

After accounting for the annual adjustment to the population controls, the employment-population ratio (58.4 percent) rose in January, and the labor force participation rate (64.2 percent) was unchanged.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) declined from 8.9 to 8.4 million in January. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

In January, 2.8 million persons were marginally attached to the labor force, up from 2.5 million a year earlier. (These data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 1.0 million discouraged workers in January, about the same as a year earlier. (These data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.8 million persons marginally attached to the labor force had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities.

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