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Unemployment Drops To 8.3 Percent But Discouraged Workers Rise

Paige Brettingen |
February 3, 2012 | 11:00 a.m. PST

Executive Producer

(Creative Commons)
(Creative Commons)
The national unemployment rate fell to 8.3 percent in January- a 0.8 percentage point drop since August, and with it, a nonfarm payroll boost of 243,000 jobs, according to The Bureau of Labor Statistics.

The report comes a little over one week following President Barack Obama's State of the Union Address, in which he made a call-to-action for businesses --specifically, the manufacturing industry- to create more American jobs.

"So we have a huge opportunity, at this moment, to bring manufacturing back.  But we have to seize it.  Tonight, my message to business leaders is simple:  Ask yourselves what you can do to bring jobs back to your country, and your country will do everything we can to help you succeed," President Obama said in his speech on January 25.

The manufacturing industry led as one of the prominent job producers in the month of January. Other industries that took top rankings included professional services as well as leisure and hospitality.

According to Reuters, job growth hasn't been this high since April 2009 and the jobless rate hasn't been this low in three years:

"More pistons in the economic engine have begun to fire, pointing to accelerating economic growth. One of the happiest persons reading this job report is President Obama," said Sung Won Sohn, an economics professor at California State University Channel Islands.

Not included in the 8.3 percent of unemployed workers are the 2.8 million "marginally attached" workers, and among them, 1.1 million "discouraged workers." 

Discouraged workers are those who are not currently looking for work, believing employment opportunities are currently unavailable to them.

The marginally attached also include those who are able and willing to work, who have looked for a job in the past twelve months but are not currently looking for work for reasons that may have included attending school or family responsibilities.

The number of marginally attached and discouraged workers has increased nearly 11 percent since December 2011 when 2.5 million were marginally attached with 945,000 of them considered to be discouraged workers.

The Congressional Budget Office, in a report released last week, acknowledged that though the job market appears to be improving, the economy remains in "a severe slump," and that unemployment will likely stay above 8 percent for the remainder of 2012 and into 2013. This will remain contingent on gross domestic product (GDP) where output of activity affects companies' hiring rates. However, looking ahead to 2013, the CBO's report projects the GDP increasing enough to put unemployment at 5.3 percent by 2022.



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