NEW YORK – Job growth grew modestly in January and gains in the prior two months were bigger than initially reported, supporting views the economy's sluggish recovery was on track despite a surprise contraction in output in the final three months of 2012. Employers added 157,000 jobs to their payrolls last month, the Labor Department said on Friday. There were 127,000 more jobs created in November and December than previously reported. The unemployment rate, however, edged up 0.1 percentage point to 7.9 percent.
Both December and November figures were upwardly revised. December to 196,000 from 155,000 and November to 247,000 from 161,000
MARK LUSCHINI, CHIEF INVESTMENT STRATEGIST AT JANNEY MONTGOMERY SCOTT IN PHILADELPHIA, WHICH MANAGES ABOUT $55 BILLION IN ASSETS:
"Nice revision upward, and this month came in right at the sweet spot where job growth is picking up, but not at the point where the Fed's quantitative easing program is threatened. It was weaker than expected but within the margin of error. The market may be at something of a top here, but we are rising on improved economic fundamentals so the rally has been rational."
TERRY SHEEHAN, ECONOMIC ANALYST, STONE & MCCARTHY RESEARCH ASSOCIATES, PRINCETON, NEW JERSEY:
"This is actually a really good number when you take into account the net upward revision. The payroll growth of 157,000 jobs was pretty much in line with market expectations, but we got a net upward revision of 156,000 over the course of the previous two months, which essentially doubles that. This places the fourth quarter in a much stronger light. Average weekly hours were flat, which was not unexpected. Average hourly earnings were up 0.2 percent. It's a modest gain, but it's a gain.
"The uptick in the unemployment rate to 7.9 percent isn't really significant. Unrounded, it's 7.923 percent. It's not wholly unexpected and the reduction in labor force slack is going to be a long, slow process."
SEAN INCREMONA, ECONOMIST, 4CAST LTD, NEW YORK:
"January was pretty well along with expectations but the revisions are quite healthy, so it gives a positive bias to the numbers. The uptick in the unemployment rate is more likely noise than any change in trend. There is still not much progress on the unemployment rate but the underlying pace of improvement in payrolls is still there."
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(Americas Economics and Markets Desk; +1-646 223-6300)