A man checks job listings in New York. U.S. employers have added 192,000 jobs
The U.S. jobless rate unexpectedly fell to 8.9 percent, the lowest in almost two years, and employers added 192,000 jobs in a sign of growing confidence in the recovery, the Labor Department reported Friday.
Meanwhile, California's unemployment rate dipped slightly to 12.4 percent in January, the state Employment Development Department said.
The state reported a 12.5 percent unemployment rate in December. California's jobless rate has been at or above 12 percent for 17 months.
California added 12,500 nonfarm jobs in January, bringing the state's total to nearly 14 million. Gains were seen in five of 11 sectors surveyed, including construction, manufacturing and government. Education and financial, health and business services reported job losses.
Even with the slight drop in the unemployment rate, more than 2.2 million Californians remain out of work.
The nationwide increase in payrolls partly reflected a return to more seasonable weather and followed a 63,000 gain in January, Labor Department figures showed. The median estimate in a Bloomberg News survey of economists was for an addition of 196,000 jobs last month.
Manufacturing, construction and transportation were among industries adding workers, underscoring Federal Reserve Chairman Ben Bernanke's testimony to Congress this week that there are "grounds for optimism" about improvements in the labor market. Employment growth is giving Americans the means to keep spending at retailers such as J.C. Penney Co. and Macy's Inc.
"The economy has been clawing its way back up the side of the mountain for the better part of a year and these numbers are consistent with that," Paul O'Neill, a special adviser to Blackstone Group LP and a former Treasury secretary, said in an interview with Bloomberg Television. "Where we are is the process of natural healing of our economy."
The unemployment rate was projected to rise to 9.1 percent from 9 percent, according to the survey median. The number of unemployed fell by 190,000, and those employed rose by 250,000. The size of the labor force increased by 60,000.
Some U.S. companies are ramping up hiring. Intel Corp. in Santa Clara and Home Depot Inc. announced plans last month to hire thousands of workers.
President Obama last week told the first meeting of his panel of outside economic advisers that the United States must deal with stubbornly high unemployment even as the recovery is well under way.
"We still have a ways to go," Labor Secretary Hilda Solis said in an interview Friday with Bloomberg Television. "We still have a lot of people who need jobs."
Last month's increase in payrolls was the biggest since May. If sustained, that pace would reduce the unemployment rate to 6.9 percent by November 2012, when Obama faces re-election, said Guy LeBas, chief fixed-income strategist at Janney Montgomery Scott LLC. The rate was 7.8 percent when Obama took office in January 2009.
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