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Unemployment rate lowest in 8 years

The nation's unemployment rate dropped to 4.9 percent in January, hitting its lowest point in eight years, since February 2008.

The nation's unemployment rate dropped to 4.9 percent in January, hitting its lowest point in eight years, since February 2008.

The nation's payrolls expanded by 151,000 jobs in January, lower than the increase in recent months, when payrolls expanded by 231,000 a month, the U.S. Labor Department said in its monthly jobs report, released Friday.

"While the headline payroll job gains were below expectations and a disappointment, the torrid growth rate of the last quarter was not sustainable," wrote economist Sophia Koropeckyj, managing director of Moody's Analytics in West Chester.

"Most of the other data for January was more upbeat: The unemployment rate fell - even with a hefty increase in the labor force," he wrote. "Hours and labor force participation edged up, and, most promising of all, average hourly earnings rose the most in nearly seven years."

Aside from the headlines, much of January's report represents a continuation of the status quo, mostly positive but not dramatically so.

"Changed little" is how the economists who write the report described the jobs situation in paragraph after paragraph.

The number of unemployed people: "changed little" at 7.8 million. The number of people employed part time because they couldn't find full-time hours: "little changed" at 6 million.

"Essentially unchanged" were the number of discouraged workers at 623,000 and the number of longtime unemployed at 2.1 million.

Cheryl Spaulding, who leads Joseph's People, a network of church-based support groups for the unemployed in the Philadelphia suburbs, based in Downingtown, had a mixed reaction to Friday's report.

These days, her organization is bracing for an influx of professionals from massive layoffs planned at the DuPont Co.

For now, though, "we are seeing people get positions," she said. "That is one reason the unemployment rate is lower."

But, she said, some of those jobs come because "those who are long-term unemployed have simply given up looking for a career position in their field.

"People in these jobs have skills and previous positions that are well beyond what they are doing," she said.

"So, yes, the [unemployment rate] is down, but it is not because the economy is booming."

Her overall assessment echoed that of Tony Bedikian, managing director of global markets at Citizens Bank. He splits his time between offices in Boston and Philadelphia.

"Coupled with the increased volatility in overseas markets and the weak fourth-quarter growth numbers," he wrote in a statement, "today's jobs report seems to argue in favor of the slower pace of Fed [interest] rate increases that the markets have already priced in."

Friday's report noted employment gains in construction, manufacturing, retail, and hotels and restaurants. Government employment fell with increases in hiring on local levels unable to offset state and federal declines.

Educational services employment dropped by 38,500 jobs, "due to larger-than-normal seasonal layoffs," the U.S. Labor Department report said.

Also down was temporary staffing, which lost 25,200 jobs.

"Much of the deceleration was due to what are likely to be temporary factors," wrote Nariman Behravesh, chief economist with IHS, an economic analysis company.

"This is largely 'seasonal noise.' " 215-854-2769