MercoPress. South Atlantic News Agency

Unemployment in the US falls to lowest level since October 2008, but it's not enough

The US economy added 113,000 jobs in January, the second month in a row the figure has been weaker than expected.

The US economy added 113,000 jobs in January; the second month in a row the figure has been weaker than expected. Economists had predicted the US Labor Department would report an increase of about 180,000 new jobs. However, the unemployment rate fell to 6.8%, the lowest level since October 2008.

 The jobless figures will raise concerns that, after strong growth in the second half of 2013, the US economic recovery is beginning to lose its steam.

US stock markets shrugged off the news - with shares on Wall Street rising in early.

The unemployment rate is calculated from a different survey to the jobs figure, known as non-farm payrolls. The rate is based on a survey of households, while the jobs figure is based on a survey of employers.

December's surprisingly weak payrolls figure was revised up only modestly to 75,000, from 74,000.

The construction industry, most vulnerable to the impact of bad weather, added 48,000 jobs in January, indicating that while the weather may have been responsible for December's weak figures, it does not appear to have been a factor in January.

Manufacturing hiring also picked up, adding 21,000 jobs. Another positive factor from the report was that more Americans started looking for, and found, work.

But there were declines in hiring in retail, utilities, government, and education and health employment.

Earlier this week, an unexpectedly weak manufacturing report raised concerns about the strength of the US economy and sent the Dow Jones tumbling by 326 points. However, analysts were not too despondent about the latest numbers.

But one of the members of the Federal Reserve, Richard Fisher, told the broadcaster CNBC that the bank wouldn't be swayed by one month's numbers, blaming the weather for the weak report.

“I will say this about the rest of our committee, they are not swayed by a single number. They are thoughtful people,” he said.

The US Federal Reserve has started withdrawing its extra support from the economy - a process known as tapering - after judging that the economy was improving, citing stronger jobs growth as one of the factors.