Unemployment rate drops to 9.7%

UNEMPLOYMENT RATE DROPS TO 9.7%…. Expectations for the new jobs report were all over the map. The actual results offered a mixed bag.*

The United States economy shed 20,000 jobs in January, the government said Friday, deepening concern that relief from the deepest economic downturn in a generation would be slow to come. But the unemployment rate fell to 9.7 percent from 10 percent in December.

As the broader economy gains steam and crucial sectors like manufacturing spring back to life, analysts say the recovery appears to be intact. But the nation’s stubbornly high unemployment rate remains a persistent thorn in the side of optimists, and economists expect the situation to worsen before it gets better.

Job totals from November and December were revised and changed rather significantly. Whereas previous estimates showed 4,000 jobs were added in November, the economy actually added 64,000. December, however, was much worse than previous thought, losing 150,000 jobs rather than the 85,000 originally reported.

The good news, if you can call it that, is that January 2010 was the second best month for the job market since the Great Recession began in December 2007. The trend line seems to be pointing in the right direction. The bad news, obviously, is that shedding fewer jobs isn’t nearly good enough.

In terms of the politics, lawmakers are poised to take up a jobs bill as early as next week. One can only hope that the latest report will remind policymakers that the status quo, while vastly improved over the disastrous conditions of a year ago, is still not even close to where we need to be. The need for an ambitious jobs bill and additional economic stimulus should be obvious.

And with that, here once again is the homemade chart I’ve been running the first Friday of every month, showing monthly job losses since the start of the Great Recession:

jobsjan09.png

* corrected