The worst US employment slump in the post-World War II era may have almost ended last month, signaling the recovery will not be jobless much longer, economists said before reports this week.
Payrolls probably fell by 1,000 workers last month, the smallest drop since the recession began two years ago, according to the median of 58 economists surveyed by Bloomberg News ahead of a Labor Department report to be released on Friday.
The unemployment rate may have climbed to 10.1 percent from 10 percent.
Stimulus-driven gains in global demand mean US companies may need to start boosting payrolls this year after eliminating 7.2 million jobs since the recession began in December 2007.
Manufacturers are leading the rebound in growth as a pickup in orders and rising exports, combined with a record reduction in inventories, spurs production.
“Businesses are starting to come out of their shells,” said Zach Pandl, an economist at Nomura Securities International Inc in New York. “We have turned the corner convincingly and have started on a path toward growth.”
The declines in payrolls the last two years have been the biggest as a percentage of all jobs since 1944 or 1945.
A 10.1 percent reading last month would put the average jobless rate last year at 9.3 percent. The increase from 5.8 percent in 2008 would mark the biggest annual surge in records going back to 1940.
Economists anticipate the jobless rate will exceed 10 percent through the first half of this year, the median forecast of economists surveyed last month showed.
US President Barack Obama last month proposed additional spending on the nation’s transportation system, tax credits to spur hiring by small businesses and incentives to make homes more energy efficient in a second round of efforts to cut the jobless rate.
Lawrence Summers, the White House chief economic adviser, said in a Bloomberg Radio interview on Dec. 15 that the prospect of a return to job growth is “an important achievement.”
The economy grew at a 2.2 percent annual rate in the third quarter, the first gain in more than a year.
The median projection of economists surveyed last month anticipated growth of 3 percent in the last three months of last year. Since the survey, economists at JPMorgan Chase & Co and Credit Suisse have revised estimates to more than 4 percent.
Staffing at temporary employment agencies jumped the most in five years in November, which some economists and executives view as a sign total payroll growth is imminent.
Increases in temporary hiring are “a classic part of the recovery,” Manpower Inc chief executive officer Jeffrey Joerres said in a Bloomberg Television interview on Dec. 31. The firm is seeing “slow but steady increases in people who are out on assignment. It’s a little bit in every office, which is a good sign because it’s broad-based.”
Manufacturing, which accounts for about 12 percent of the economy, has been a driver of the recovery and is projected to continue to expand.
The Institute for Supply Management may report today its factory index rose last month to 54, the survey median showed. The gauge has surpassed the breakeven level of 50 since August.
A separate report from the Commerce Department tomorrow may show factory bookings increased 0.5 percent in November after rising 0.6 percent the previous month, to economists surveyed said.
Another report from the supply managers may show the broader economy returned to expansion last month.
The group’s gauge covering non-manufacturing companies, due on Wednesday, probably rose to 50.5, the survey median showed.
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