Unemployment Rate Falls in January

Today's report does reflect changes in the way the government is collecting jobs data. The Labor Department for the first time issued data on earnings and hours for all workers.

Before today, the figures reflected changes in earnings and hours for production staff. And the household details issued today for the first time include breakouts for employment status of veterans, the disabled and foreign-born people.

Meantime, employers last month announced plans to reduce payrolls by 71,482 workers, according to a report this week by Challenger, Gray & Christmas, a Chicago-based outplacement consultancy.

The firm said the total is the highest job-cut tally in five months and that the surge resulted primarily from heavy downsizing in the retail and telecommunications sectors.

The January job-cut total was 59 percent higher than December 2009, when announced layoffs fell to a 24-month low of 45,094.

This is the first increase in monthly job cuts since July, according to Challenger, Gray & Christmas. It's the largest monthly total since last August, when employers announced 76,456 layoffs.

The increase in the job-cut total in January is not necessarily a sign of a recession relapse, said John A. Challenger, chief executive officer of Challenger, Gray & Christmas. He said it's not uncommon to see a surge in job-cut announcements to begin the year.

"Companies are making adjustments based on the previous year's results and the outlook for the year ahead," he said, adding that "heavy job cuts could continue in retail and other sectors through the first quarter."

Peter Morici, an economics professor at the University of Maryland's Robert H. Smith School of Business, said key sectors to watch in today's employment report are manufacturing, retail sales, and construction.

"Manufacturing is picking up steam, and more firms are adding employees than shedding them," Morici said.

"If stronger consumer confidence is translating into mall activity, retail employment, which was down 10,000, in December, should level off in January."

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