US jobless rate rises to 7.9%

The US unemployment rate rose to 7.9 percent in January from 7.8 percent in December and the economy added 157,000 jobs, the Labor Department said Friday.

After a sweeping revision of 2012 data, the department also said monthly job growth averaged 181,000 last year, well above its prior estimate of 153,000 jobs.

December's jobs gains were revised 26 percent higher, to 196,000.

The 7.9 percent jobless rate was close to the level where it has been since September.

The private sector remained the sole engine of jobs growth in January, adding 166,000 jobs. Government jobs fell by 9,000.

Employment rose notably in retail trade, construction and health care, while jobs in transportation and warehousing slipped.

There was little change in manufacturing employment, which has been essentially flat since July 2012.

The January readings were less positive than expected. Most analysts projected the jobless rate fell to 7.7 percent and the US added 180,000 net jobs.

But the sharp upward revisions to prior data showed the jobs market was in much better shape in 2012 than previously thought.

The report, as expected, showed the jobs market moving sideways in January after the economy shrank 0.1 percent in the fourth quarter of last year.

The number of unemployed rose by a little more than 100,000, to 12.33 million.

The employment-population ratio and the civilian labor force participation were essentially unchanged.

"The rise in the unemployment rate was a disappointment, and the January rise in payrolls was a little below the recent trend -- especially after the upward revisions -- although we also know how unreliable January data can be," said Jim O'Sullivan at High Frequency Economics.