US: unemployment is falling but the pace of job creation slowed – The World

Le Monde | 02/05/2016 at 5:08 p.m. • Updated 02/05/2016 at 5:46 p.m. | By Stéphane Lauer (New York, corresponding)

signs of a slowdown in growth in the United States are increasing. The US economy created 151,000 jobs in January, according to statistics published on Friday, 5 February by the US Department of Labor. The figure is well below the expectations of economists who had forecast 185,000, while data for the month of December 2015 have also been revised downward to 262,000 instead of the 292,000 announced in the first place.

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While the unemployment rate fell slightly to 4.9%, 0.1 percentage point from the previous month. This is the first time it passes below 5% since February 2008, when the financial crisis was announced with the bankruptcy of Bear Stearns. However, this indicator only gives a partial view of reality of the labor market to the extent that the reduction in unemployment is largely due to the fact that many unemployed disappear statistics. The participation rate, that is to say the proportion of people who have a job or looking for one, is only 62.7%, a level not seen since the 1970s.

the number of long term unemployed is much higher than before the recession in 2009

Moreover, when taking into account the time partial suffered, the unemployment rate was unchanged at 9.9%. Theoretically, there are just under 8 million unemployed in the United States. But if we take into account these factors underemployed, the number climbs to 16 million, said recently the chairman of the Financial Services Committee of the House of Representatives, Republican Jeb Hensarling. “This figure includes 6 million Americans who are forced to work part-time because there is nothing else available,” he says. It also notes that the number of long term unemployed is much higher than before the recession of 2009

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When we look in detail the areas that have created the most jobs, there are once again the low-skilled and low paid jobs. Distribution and catering account for two thirds of jobs created in January. Then come health with 37,000 jobs created and the industry with 29 000. The latter figure has surprised analysts to the extent that the manufacturing sector is in recession for four months now. However, in the energy sector, the slump continued with the destruction of 7,000 jobs. Since September 2014, and the acceleration of the falling oil prices, the sector lost 146,000 jobs, or 17% of total enrollment.

A mixed impression

the good news came from wage growth, which finally begins to shudder. The average hourly wage grew by 0.5% in January. Over the last twelve months, the increase was 2.5%. however difficult to speak frankly acceleration: in previous upturns, US wages increased on average by 3.5%. Six years after the start of the current phase, we are still far away. “Part of the weakness in job creation is likely to be temporary and revenue growth suggests that wage growth will accelerate,” , however, note the BNP Paribas economists in New York.

These indicators thus give a mixed impression. Even if the labor market remains largely creator of jobs, the dynamic seems to be over. Importantly, these data are published after several disappointing figures. With a 0.7% annual rate, gross domestic product (GDP) has almost stood still in the fourth quarter 2015. In addition the industry, which is affected both by higher oil prices and the global slowdown, gives serious signs of weakness. Industrial orders still fell 2.9% in December, according to figures released Wednesday, February 3rd. On Friday, the Commerce Department also announced that the trade deficit widened by 2.7% in December and 4.6% over the full year 2015. For the first time since the financial crisis, US exports were down (- 4.8%)

for now, the world’s largest economy was mainly driven by consumption and dynamics in the service sector.. But again, growth slows. The non-manufacturing index fell 2.3 percentage points in January to 53.5%. Although it remains above the 50% threshold marking the border between contraction and growth in business, it is still the third consecutive month of slowdown.

In this context the Federal Reserve (Fed), which says “closely monitor the international economic and financial developments,” should continue to be cautious about the rise of interest rates. The 1 ^st February, the vice chairman of the Fed, Stanley Fischer, has said that if the volatility in financial markets persisted, “it could signal a slowdown in the global economy capable of affecting the growth and inflation in the US “. Traders and investors believe only 14% probability that the central bank conducts further monetary tightening at the next meeting in March

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