New Job Data Cast Doubt on Economy's Slowing
WASHINGTON -- The spate of new jobs created by American companies last month casts doubt over the conventional wisdom that the economy is slowing.</br></br>Most analysts have argued that the Asian financial crisis was beginning to rein in the galloping U.S. economy to a more manageable trot. But in the government's first official look at January economic activity, the Labor Department said Friday that nonfarm businesses added 358,000 workers to their payrolls. That was slightly more than were generated in December's robust job market and well above the healthy 267,000 average monthly rise through 1997.</br></br>The employment report also showed how the rising economic tide is lifting more and more boats, with joblessness falling sharply even among high-school dropouts. For the first time, the Labor Department started reporting employment data by level of education, and said the unemployment rate for people without high-school diplomas fell to 7.2% last month from 8.9% a year earlier. Even so, the numbers confirmed that education still matters a lot: the unemployment rate for college graduates was a minuscule 1.9% last month, down from 2.1% a year earlier. (The department had been collecting these figures in the past, but not posting them.)</br></br>The January unemployment rate for all workers stayed at the same 4.7% of the work force reported in December. The low jobless level continued to give workers more bargaining power, as average hourly earnings rose by four cents, to $12.51. During the past year, wages rose 3.8%, or about twice the inflation rate. The figures are adjusted for seasonal factors.</br></br>In contrast, other data released recently indicate some sort of economic slowdown. The monthly survey of manufacturers' purchasing managers released last week showed some decline in business, as did the government's report on factory orders in December. Consumer confidence is reported to have dropped sharply in January. Anecdotal evidence -- such as disappointing profit reports and job cuts at blue-chip companies -- has added to the perception of softening. Policymakers have assumed some easing from last year's torrid growth rate was imminent. That was a big reason the Federal Reserve kept interest rates steady last week.