Weather a Factor in Slow U.S. Job Growth Justin Sullivan/Getty Images A “Job Hunters Boot Camp” was held last month in Burlingame, Calif., tailored for people who have been out of work for at least six months By MOTOKO RICH Published: February 4, 2011

Weather a Factor in Slow U.S. Job Growth

Justin Sullivan/Getty Images

A “Job Hunters Boot Camp” was held last month in Burlingame, Calif., tailored for people who have been out of work for at least six months

By MOTOKO RICH

Published: February 4, 2011

The United States labor market slowed to a crawl in January, adding just 36,000 jobs last month, far below consensus market forecasts.

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Source: Bureau of Labor Statistics

Related

• Economix Blog: Leonhardt and Norris on the Jobs Report (February 4, 2011)

With 13.9 million people still out of work, the unemployment rate actually fell to 9 percent in part because of a readjustment of population figures and also because fewer people looked for jobs during the month.
The disappointing jobs number, restrained by snowstorms and government layoffs, was far below what economists generally say is needed to merely keep pace with normal population growth.
Although some economists said they would largely disregard January’s data because of the effects of bad weather, others said that underlying job growth was still not robust.
“You can blame weather for the number being as low as it is,” said Steve Blitz, a senior economist for ITG Investment Research. “But even if you abstracted out the weather, you’re still not getting the dynamic job growth that is going to cut the unemployment rate significantly.”
Private companies added 50,000 jobs in January, while federal, state and local governments shed 14,000 jobs.
The job figures came in a week when several other indicators pointed toward an accelerating recovery. A closely watched survey of purchasing managers rose to its highest level since May 2004, and chain store sales increased at a faster pace than expected in January.
Health care, manufacturing and retail provided the strongest job growth, while construction continued to lag. Temporary help, which had been strong throughout 2010, actually lost 11,400 jobs.
Some economists said January’s snowstorms appeared to especially affect construction, which lost 32,000 jobs, and transportation and warehousing, which shed 38,000 jobs.
For the unemployed, the slow addition of jobs is increasingly frustrating. “If you want to get there and you’re sitting in an airplane, the fact that the airplane is moving 20 miles faster down the runway doesn’t matter to you,” said Cliff Waldman, economist at the Manufacturers Alliance/MAPI, a trade group. “You want it to take off.”
The Labor Department’s monthly snapshot of the job market also included its annual “benchmark revisions,” which suggested that job growth during 2010 was actually lower than originally reported.
The report included upward revisions to November and December’s numbers, lifting job creation in November to 93,000 from 71,000, and in December to 121,000 from 103,000.
The disproportionate burden that the grim labor market has imposed on the less skilled remained pronounced in January’s numbers. The unemployment rate among those with less than a high school diploma was 14.2 percent, while the rate among those with a bachelor’s degree or higher was 4.2 percent.
Recruiters and staffing companies underscored the fact that employers who are currently hiring are looking to fill slots that generally require candidates with college degrees. Evan Davis, chief operating officer of MRI Network, which has 700 franchised recruiting offices throughout the United States, said that the company had witnessed a strong increase in postings for information technology, engineering and health care jobs. In fact, Mr. Davis said, some employers were having difficulty filling such slots.
“It’s actually hard to meet the demand that’s out there,” he said. “It’s really hard to find top talent.”
Economists noted that job growth would not truly hit the kinds of levels needed to seriously dent the unemployment rate until employers beyond a handful of industries started hiring in earnest. Construction, which was among the hardest hit during the recession, has also not revived.
“It’s very brutal in our industry,” said Brantley Barrow, chairman of Hardin Construction, a builder of office buildings, malls and hotels based in Atlanta. “Even though the general economy is getting better, it’s going to be another year or two before things start to improve in our industry.”
The numbers underscored the assessment of the Federal Reserve chairman, Ben S. Bernanke, who said on Thursday that “until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established.”