US Economy Creates 49,000 Jobs, Unemployment Falls to 6.3 %

The US economy added just 49,000 jobs in January, a sign that the viral pandemic retains a tight grip on the economy nearly a year after it triggered a painful recession.

The tepid increase followed a decline of 227,000 jobs in December, the first loss since April. The unemployment rate for January fell sharply from 6.7 percent to 6.3 percent, the Labor Department said Friday.

Most of the drop in unemployment occurred because some people out of work found jobs, while others stopped looking for work and were no longer counted as unemployed.

Friday’s figures reflect a faltering job market, slowed by the pandemic that is still causing consumers to avoid traveling, shopping, dining out, attending entertainment venues, and engaging in other forms of face-to-face contact.

With many employers still cutting staff, nearly 10 million jobs remain lost to the pandemic.

Last month, service industries that deal with customers in person again posted the sharpest job losses as millions of consumers continue to hunker down at home. Within the service sector, restaurants, bars, and hotels slashed 61,000 jobs. Retailers cut nearly 38,000 jobs. Employment in transportation and warehousing fell by 28,000.

Women who have been disproportionately hurt since the job market collapsed in early spring have been leaving the workforce, often to care for children at home attending school online.

That pattern continued in January. At the same time, the number of men with jobs increased last month.

As hiring has slowed, layoffs have kept mounting.

The number of applications for unemployment benefits, though declining for the past few weeks, remained at an elevated 779,000 last week.

The hardships that millions of Americans are suffering trends have fueled President Joe Biden’s push for a $1.9 trillion rescue aid package, which would provide $1,400 checks for most U.S. inpiduals and a $400 weekly unemployment payment on top of state benefits. The package would also extend two federal jobless aid programs, from mid-March through September.