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US unemployment down to 8.3% as 243,00 jobs added in January

More good news for Obama as surge of hirings in January means economy created jobs at fastest pace in nine months

US employers have scotched signs that the pace of economic recovery is slowing, stepping up hiring in January and bringing the unemployment rate down for the fifth month in a row, to a three-year low of 8.3%.

According to the labour department’s closely watched nonfarm payroll figures, the US added another 243,000 last month, the biggest gain since April. The jobless figure is the lowest it has been since February 2009.

The numbers will be a major boost for president Barack Obama, as the economy looks set to be the key battleground of the 2012 election. They figures also come after recent signs that the US recovery was slowing. Economists had forecast more modest jobs growth and for the jobless rate to remain at 8.5%.

Marcus Bullus, trading director at MB Capital, said the nonfarm payroll figures were a “humdinger.”

“They smashed expectations, and will be a fillip to markets globally.” he said.

“The US economy is growing, and it’s continuing to add jobs at an impressive rate. Those are two claims the eurozone would love to be able to make.The divergence between the US and European economies is becoming more pronounced by the day.”

The Labour Department also reported that job growth was stronger in previous months than it initially calculated. The economy gained 60,000 jobs beyond the government’s preliminary figures for November and December.

In another positive sign, average hourly earnings increased, up 4¢, or 0.2%, to .29. The number of hours worked also increased from 34.5 from 34.4.

The pickup came across a variety of sectors. The professional, business and services industry added 70,000 jobs, manufacturing added 50,000 jobs, boosted by the recovery in the auto industry. Leisure and hospitality increased by 44,000.

Still, there is a long way to go. The job market still needs to add about 6 million jobs to get back to 2008 employment levels. The latest report said wages were only up 1.9% year on year – not enough to keep up with inflation. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds