Jobless Rate Falls To Lowest Level Since July 2001
WASHINGTON -- Job creation accelerated in January, pushing the unemployment rate to its lowest mark in more than four years and offering fresh evidence that the economy got off to a strong start this year.</br></br>The economy created 193,000 nonfarm jobs last month, 53,000 more than in December, the Labor Department said Friday. While the gain fell short of many analysts' expectations, any disappointment was offset by revisions to December and November figures showing 81,000 more jobs were added than originally estimated. Over the past three months, nonfarm payroll employment expanded at a rate of 229,000 a month.</br></br>The jobs report had even better news for workers. The demand for workers sent the unemployment rate to 4.7% from 4.9% in December, its lowest level since July 2001, and the average hourly wage rose to $16.41 from $16.34. Compared with January 2005, hourly pay rose 3.3%, a near three-year high that puts the rate of yearly wage growth roughly in line with the 3.4% annual inflation rate.</br></br>Together with a recent spate of positive indicators, particularly in the manufacturing sector, the employment report points to a newly vigorous economy after the fourth quarter's lull. The main reason: Consumers propel 70% of the economy with their purchases, and wage growth generally leads to higher spending.</br></br>The Federal Reserve will pore over the jobs report to gauge how much pressure higher wages will put on prices, which could lead to inflation. Most analysts interpreted Friday's jobs report as an indication that Fed policy makers will raise interest rates again next month, although there is much debate over whether it should.