Nightly News   |  February 05, 2010

Unemployment rate drops amid more job losses

The government on Friday reported a surprise drop in the unemployment rate last month to a five-month low of 9.7 percent, but the economy is still lost 20,000 jobs. NBC's John Yang reports.

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>> with us tonight.

>>> before this storm boiled up and exploded into a major weather event, the big story this morning was actually the new job numbers that came out. employers cut 20,000 more workers from their payrolls in january, but the unemployment rate is down, under 10% now to 9.7%. that may not match what you are seeing in your area where you live because it's much more complicated than that. our report tonight from nbc's john yang in chicago.

>> reporter: at a small business in suburban washington, president 0 obama wasn't ready to claim victory.

>> these numbers, while positive, are a cause for hope, but not celebration.

>> reporter: in fact, today's numbers show the jobs picture is bleaker. 1.2 million more jobs lost than previously thought, a total of 8.4 million jobs gone since the recession began. but the pace of job losses is slowing. analysts say they are signs the economy could be poised to start climbing out of that deep hole.

>> it is saying we are close to a tipping point. it's also saying it's not going to be a enough for a lot of workers to feel any better about this economy.

>> reporter: especially for the hardest hit. unemployment for african-americans went up to 16.5%. the number of people out of work for six months or more hit a record, 6.3 million. there are some bright spots. manufacturing jobs, the first increases in more than two years. and temporary workers. signs of a recovery struggling to take hold. a rise in hours worked and productivity suggest those with jobs are working longer and harder. last january, michael's youngstown, ohio, firm had its first lay-offs ever.

>> making decisions to cut work force is not a decision i take lightly and actually agonized over it.

>> reporter: over the past 12 months they cut the payroll from 82 to 70. business is picking up, but they are cautious about hiring. what will it take for mike to add workers to the shop floor?

>> when they start screaming way too much overtime.

>> it was great to be back. it felt like coming home, you know?

>> reporter: a feeling millions of laid-off workers across america are still hoping for. john yang , nbc news, youngstown, ohio.

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