US sees surprise job boost

WASHINGTON: The Labor Department on Friday reported a surprise jump in US job creation, providing a rare glimmer of hope about the state of the world's largest economy even as the unemployment rate remained painfully high.

The US economy created 103,000 jobs in September, a much stronger clip than expected, but not enough to lower the unemployment rate from 9.1 percent -- where it has been stuck for three months.

"The sky is not falling just yet," said Joel Naroff of Naroff Economic Advisors, welcoming the news.

"Businesses continue to add workers and it is hard to see how we could be in recession if payrolls are growing."

The private sector accounted for all the job gains during the month and the figures were made more rosy by the return of 45,000 telecommunications workers who had been on strike in August.

While US jobs figures are seen as a bellwether for the health of the domestic economy, they are also closely watched around the world.

"The US labor market has performed better than feared in recent months," said Chris Williamson, an economist with London-based financial firm Markit.

Economists had expected the report to say that the unemployment rate was still jammed at 9.1 percent, with the economy replacing just 60,000 of the nine million jobs lost during the crisis.

The private sector in fact created 137,000 jobs, including the return of the striking workers.

As expected the government shed jobs aplenty, as local authorities tightened their belts.

Half a million government jobs have been lost since 2008.

"Job gains occurred in professional and business services, health care, and construction. Government employment continued to trend down," the Labor Department said.

With around 14 million American workers currently unemployed and nearly half of those looking for work for more than six months, the report was only cautiously welcomed by the White House.

"The unemployment rate remained unchanged at 9.1 percent, a level that is unacceptably high," said Katharine Abraham, a member of President Barack Obama's Council of Economic Advisers.

"Clearly, we need faster economic growth to put Americans back to work. Today's report underscores the president's call for Congress to pass the American Jobs Act," said Abraham.

In recent days Obama has stepped up pressure on Congress to pass a $447 billion jobs bill which he says could create 1.9 million posts.

Republicans, who oppose the plan, said the latest figures were another indication of Obama's mismanagement of the economy.

"There were far too few jobs created this month, which shows the need to spend less time making campaign style speeches and more time trying to work together to identify policies that we both can agree will create an environment for job creation," said House of Representatives Majority Leader Eric Cantor.

The major US stock indexes also gave Friday's report a cautious welcome. The Dow Jones Industrial Average was up half a percentage point by 1430 GMT.

Copyright AFP (Agence France-Presse), 2011