* The fall in the unemployment rate was a legitimately good move. It was not driven, as it sometimes is, by labor force dropouts. The labor force rose noticeably, but the household gauge of employment jumped by even more. Controlling for the one-off downward adjustment in the population controls, the labor force grew by 360,000 in January while household employment surged by 784,000, more than reversing the big December decline that we found puzzling and a bit troubling. In 2003 (and to some degree in prior cycles), household employment began to rise well before payrolls. So, the household survey may finally be getting with the program, which would provide another hopeful sign that payroll employment will soon turn up decisively. –Stephen Stanley, RBS
* We judge there is more good news than bad news in this report and we think labor market trends remain on track to show the emergence of job creation in the first quarter. The average job loss over the last three months is only 35,000 (the smallest since March 2008) and hours worked increased 0.2% (the equivalent of creating over 230,000 private-sector jobs). While the fall in the unemployment rate will be good news politically, we think it is a function of the volatility of the household survey (which showed a loss of 589,000 jobs in December and an increase of 541,000 jobs in January) and we would not be surprised if the unemployment rate increases next month. –RDQ Economics
* This report definitely printed on the weak side of expectations, though the guts of the report actually implies a decent monthly jobs report and a broader improvement in the labour market. The net revisions were quite high at -930,000, though the fact that the headline unemployment rate and the alternative U-6 measure of unemployment both turned lower is an encouraging sign. Additionally, the improvements in the manufacturing sector and the service-producing sector in January do indicate a pickup relative to recent trends. While the worst of the recession is likely over, the duration of unemployment remains stubbornly high, though the median measure did post improvement. This was one of those reports where the ‘negative’ column was offset with the ‘positive’ column, leaving us to maintain our view that the U.S. labour market remains on the slow path to recovery –Ian Pollick, TD Securities
* The labor market continues to stabilize and sustained gains in employment could begin this spring. Aside from the battered construction and state-and-local government, employment is on an uptrend. Even in manufacturing, jobs increased for the first time since the recession began… There are other telltale signs pointing to the improvement in the labor market. The workweek, hourly earnings and the hiring of temporary help have risen. These are good omens for the job market. Employers want to be cautious about hiring and test waters before taking on full-time employees. –Sung Won Sohn, Smith School of Business and Economics
* More problematic is the continued surge in temporary hiring. A leading indicator in the past, this category has become a leading employer instead. Perhaps once the health care debate is settled some of these jobs will swap into permanent employment, but in the meantime firms are willing to take on workers but not at the expense of benefits on the way in or severance on the way out. The long duration of this recession may also be creating an army of permanently unemployable, a group of forgotten men (and women) – a legacy problem from the 1930s. –Steven Blitz, Majestic Research
* The big truth of today’s report is not that the job market improved, which it did not. The big truth is that with downward revisions to previous employment reports, there were more jobs lost than had previously estimated. Furthermore, there was also a very large decrease in the number of unemployed workers by 378,000, as most of these people became “permanent job losers,” according to the Bureau of Labor Statistics. In other words, this is not a positive employment report. Clearly, a job-less recovery is occurring. –Jason Schenker, Prestige Economics
* All in all, we see encouraging signs of progress in labor market conditions and expect to see much better payroll performance (ex-census) in coming months. The census worker effect was only +9,000 (vs an expected +25,000). This will become a more important special factor over the course of coming months and should peak in May at an estimated +425,000 on a monthly change basis (or +700,000 on a level basis). These workers will disappear from payrolls over the second half of the year.–David Greenlaw, Morgan Stanley
* Following the huge downward revision of the payroll numbers between April 2008 and December 2009, U.S. employment has declined by 8.4 million (or 6.1%) during the start of the recession in December 2007. And while the bulk of the revisions (930k) were for the period between April 2008 and March 2009, the numbers for the last nine months (April to December 2009) were also revised down by 430k. As a result, the revised payrolls figures for September and October still show declines of 224k and 225k, respectively. Against this backdrop, the swing to -20k in December is a remarkable improvement, and suggests that the labor market is finally approaching its bottom. –Harm Bandholz, Unicredit
* The upward revisions to the monthly job loss data are particularly big for the second half of 2008 and the second half of last year. The latter is very worrying. The bigger declines in 2008 suggest that the economy was in deep trouble before the collapse of Lehman Brothers, undermining claims that a recession could have been averted if the bank had only been saved by the Fed. –Paul Ashworth, Capital Economics
* Turning points in the business cycle data are always difficult to interpret, but the January payrolls added a dollop of Zen like logic to a recovery that is shaping up like no other. An additional 111,000 workers entered the labor force, yet the unemployment rate fell to 9.7% while private sector employment continued to contract. Hours worked, demand for temporary workers and the hiring in the service sector all improved. However, without the benchmark revisions, the unemployment rate would have increased to 10.6% which better captures the condition of an economy that has seen 8.4 million workers displaced during the recession –Joseph Brusuelas
http://blogs.wsj.com/economics/2010/02/05/economists-react-jobs-report-has-more-good-than-bad/
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