Updated March 25 at 12:28am

U.S. payrolls rose in January after jumping at end of 2012


WASHINGTON - Hiring increased in January after accelerating more than previously estimated at the end of 2012, evidence the U.S. labor market was making progress even as lawmakers quarreled over the federal budget.

Payrolls rose 157,000 following a revised 196,000 advance in the prior month and a 247,000 surge in November, Labor Department figures showed today in Washington. The revisions added a total of 127,000 jobs to the employment count in November and December. The jobless rate increased to 7.9 percent from 7.8 percent.

Sustained hiring gains will give incomes a lift, buffering American workers from the sting of higher payroll taxes and helping them keep spending. At the same time, bigger employment advances are needed to drive down a jobless rate that Federal Reserve officials say is too high.

“The U.S. labor market has been very resilient in recent months,” said Harm Bandholz, chief U.S. economist at UniCredit Group in New York, who forecast a 160,000 gain in payrolls. “The big story is all the upward revisions to the previous months, which gives the report a real positive spin. All these concerns that the fiscal uncertainty deterred businesses from hiring, they certainly haven’t materialized.”

Stock-index futures maintained gains after the figures, with the contract on the Standard & Poor’s 500 Index maturing in March rising 0.4 percent to 1,499.8 at 8:35 a.m. in New York.

The median forecast of 90 economists surveyed by Bloomberg called for an advance of 165,000 in January payrolls. Projections ranged from gains of 115,000 to 230,000 following an initially reported 155,000 increase in December.

Benchmark update

The Labor Department today also issued its annual benchmark update, which aligned employment data spanning from April 2011 to March 2012 with corporate tax records. The revision showed payrolls grew by an additional 424,000 workers, on an unadjusted basis, in that period.

The economy has recovered 5.51 million of the 8.74 million jobs that were lost as a result of the last recession.

Additionally, the Labor Department incorporated new Census Bureau population estimates into the household survey it uses to calculate the jobless rate. The adjustment boosted the estimated size of the labor force by 136,000. It also updated how it adjusts payroll figures for seasonal swings, affecting data back to January 2008.

Private payrolls, which don’t include jobs at government agencies, rose 166,000 in January following a revised jump of 202,000 the previous month. Economists forecast they would grow 168,000 for a second month.

Jobless rate

The unemployment rate, which is derived from a separate survey of households, was forecast to hold at 7.8 percent, according to the Bloomberg survey median. Estimates ranged from 7.6 percent to 7.9 percent.

The median duration of unemployment fell in January to 16 weeks from 18 weeks a month earlier. The number of people out of work for 27 weeks or more decreased as a percentage of all the jobless to 38.1 percent from 39.1 percent.

Today’s report showed factories added 4,000 workers in January, compared with a projected 10,000 advance and following an 8,000 increase in the previous month.

Employment at private service-providers rose 130,000 last month. Construction companies took on 28,000 workers, almost matching the 30,000 added in December. Payrolls at retailers climbed 32,600 employees.

Government payrolls decreased by 9,000 in January, including at 6,000 at the local level.

Average hourly earnings rose 0.2 percent to $23.78 from $23.74 in the prior month, today’s report showed. The average work week for all employees held at 34.4 hours.

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