Alan Kreuger, WH: 243K New Jobs Created - Unemployment Falls to 8.3%

February 3, 2012

The U.S. says its labor market surged last month, with nearly a quarter million workers added to company payrolls, and that its unemployment rate fell to 8.3 percent, the lowest in almost three years.

In its closely watched monthly report, the government said Friday that 243,000 jobs were added to the economy, a month after the world's largest economy recorded 200,000 new jobs. The January figure — the biggest addition in nine months — substantially exceeded the early estimates of economists. Analysts said the report signaled that the sluggish U.S. economic recovery might be advancing at a faster pace than first thought.

The jobs report and the jobless rate have perhaps become the two biggest barometers of the sluggishly advancing American economy. Central bank chief Ben Bernanke said this week that the recovery from the nation's 2007 to 2009 recession, its worst economic downturn in seven decades, has been been “frustratingly slow” and is likely to advance by no more than 2.7 percent this year.

"The pattern is definitely indicating the economy is improving," Alan Kreuger, chairman of President Obama's Council of Economic Advisors, said.

But the January jobs report — and the unexpected drop in the jobless rate from December's 8.5 percent rate — also could boost the re-election prospects for President Barack Obama, a Democrat seeking a second four-year term in the national election next November. The two leading contenders seeking the Republican nomination to oppose him — one-time venture capitalist Mitt Romney and former House Speaker Newt Gingrich — have regularly unleashed verbal assaults on the president's handling of the economy, calling for less government regulation of American corporations as a way to boost the country's economic fortunes.

Analysts say the additional number of U.S. jobs the last two months are a sign the American economy is growing at a time when some other economies across the globe, such as in Europe, have virtually stalled, or slowed, as is the case in China and India.

Even with the additional jobs added to the labor market in January, the U.S. has fallen far short of replacing the 8.7 million jobs lost in the recession. About 13 million workers remain unemployed, while millions more have stopped looking for work and are not factored into the monthly jobless rate.

The state of the U.S. economy has become the prime issue in the emerging presidential campaign, with many voters saying they disapprove of the way that President Barack Obama has overseen the recovery.

Mr. Obama has said that without the still-controversial economic boost the government provided some American corporations during the worst days of the recession, the national economy would be in worse shape. The country's housing market has been particularly troubled, with millions of unemployed homeowners losing their houses to bank foreclosures when they could no longer make their monthly loan payments.