Economy Sheds Jobs, Unemployment Stable

Jobs Byte by Dean Baker

For Immediate Release: February 1, 2008
Contact: Alan Barber, (202) 293-5380 x115

"For the first time since data has been kept, manufacturing is less than 10 percent of employment."
The establishment survey showed the economy losing 17,000 jobs in January, the first reported job decline since August of 2003. Over the last three months, the economy has added a total of 125,000 jobs, with the private sector adding just 99,000 jobs. The household survey showed little change in the unemployment rate, although it rounded down to 4.9 percent for January compared to 5.0 percent in December.

The job loss in the establishment survey was driven by losses of 28,000 jobs in manufacturing, 27,000 jobs in construction and 26,000 state government education jobs. The latter is likely due to a faulty seasonal adjustment and will probably be reversed in future months, but the declining employment in construction and manufacturing is very real.

Residential construction has lost 189,300 jobs since July, 5.8 percent of employment in the sector. Employment in the non-residential sector has also been drifting downward in the last three months, indicating that the boom in this sector is over.