N.J. jobless rate drops to five-year low

Saturday, March 10, 2007

By JEANNINE AVERSA
ASSOCIATED PRESS

WASHINGTON -- The nation's unemployment rate slipped to 4.5 percent in February, even as big losses of construction and factory jobs restrained overall payroll growth. Wages grew briskly.

The latest snapshot, released by the Labor Department on Friday, offered a picture of an employment climate that remains in fundamentally good shape despite slower job growth due in part to bad winter weather in parts of the country, economists said.

The latest job figures for New Jersey showed that the state added 4,600 jobs in January, dropping the unemployment level to 4.2 percent, the lowest in five years, according to the state Labor Department. The state will report job figures for February on March 21.

The slight decline in the national jobless rate, from 4.6 percent in January, came as hundreds of thousands of people left the workforce, a development that economists believe was related to the bad weather in February, which made it difficult to get out and look for jobs.

Employers, meanwhile, added 97,000 new jobs to their payrolls in February, the fewest in two years, as bad winter weather forced construction companies to slash 62,000 jobs, the most since 1991. Factories, feeling the strain of the troubled housing and auto industries, also continued to cut jobs. They eliminated 14,000 positions last month.

On a more encouraging note, job gains in the previous two months turned out to be stronger than previously estimated. Employers added 226,000 new jobs in December, versus the 206,000 last estimated. Payrolls grew by 146,000 in January, up from a previous estimate of 111,000. Although construction businesses and factories cut jobs last month, health-care providers, financial firms and retailers boosted hiring.

The new tally of jobs added to the economy in February was close to economists' forecast for a gain of around 100,000. They had predicted the unemployment rate would hold steady at 4.6 percent.

"While we may not be creating as many jobs as we would like to see, the labor market is still in good shape," said Joel Naroff, president of Naroff Economics Advisors.