WRAPUP 1-US employers likely added 5,000 jobs last month

* U.S. nonfarm payrolls seen gaining 5,000 in January

* Revisions to show deeper losses than previously thought

* Unemployment rate seen rising to 10.1 percent

By Lucia Mutikani

WASHINGTON, Feb 5 (BestGrowthStock) – U.S. employers probably
stopped cutting jobs and added 5,000 payrolls in January, the
second monthly gain since the recession started in December
2007, the government is expected to report on Friday.

The Labor Department, however, will also say job losses
during the most severe U.S. economic downturn in 70 years were
deeper than initially thought.

The employment report, which contains the payrolls data and
jobless rate, will be packed with revisions dating back to
2005. There will also be revisions to payroll figures between
March and December last year, and analysts urged caution in
interpreting the data.

To further complicate the report, January also has a large
seasonal adjustment factor. January normally experiences a
surge in lay-offs after the holiday-season hiring, which this
year economists say may be less than usual.

“We will be inclined to treat either a very strong or weak
employment report — particularly the payroll portion — with a
greater-than-usual degree of skepticism this month,” said
Andrew Tilton, an economist at Goldman Sachs in New York.

A Reuters survey predicted nonfarm payrolls grew 5,000
after a surprise 85,000 drop in December. Payrolls increased by
4,000 in November. The unemployment rate, however, is expected
to edge up to 10.1 percent in January from 10 percent the
previous month.

Job estimates vary widely, ranging from a loss of 75,000 to
a gain of 100,000. A median prediction from the 20 most
accurate forecasters saw payrolls unchanged last month.

With Americans increasingly anxious about double-digit
unemployment, President Barack Obama has declared that job
creation will be his top priority in 2010.

Obama’s fellow Democrats fear voters could punish them in
congressional elections due in November if the administration
fails to make headway in tackling the high jobless rate.

The government has estimated that for the 12 months to
March 2009, the number of people employed will be revised down
by about 824,000, meaning the economy shed far more jobs than
previously thought.

“As such, the preliminary estimates suggest that the job
cuts during the recession were even more aggressive, totaling
8.1 million,” said Dean Maki, chief economist at Barclays
Capital in New York.

The government will also publish revised population
estimates in its smaller Household Survey, from which the
unemployment rate is derived.

While this could have a large impact on the labor force and
household employment, a marginal effect on the jobless rate was
expected, with revisions published in the December report.

Financial markets have grown nervous about the prospect of
unemployment in the United States remaining high for a long
time. The economy resumed growth in the second half of 2009,
but that has yet to translate into a labor market recovery.

January’s report could show a rise in government employment
as hiring for the 2010 Census got underway. A large seasonal
adjustment could also bump up January payrolls.

Normally there is a large shedding of workers in January,
but analysts reckon that after a year of extraordinary job
losses, there might be fewer seasonal workers to lay off this
time around.

“Even if we have an increase (in payrolls), there will
still be some lingering doubts given that in the last few weeks
(initial jobless) claims have moved higher, that will make some
people greatly concerned about the sustainability of any
improvement,” said Michael Feroli, an economist at JP Morgan in
New York.

New applications for state unemployment benefits have
trended higher in recent weeks. But some economists saw hopeful
signs in robust productivity growth data on Thursday, which
they said implied businesses might need to start hiring more
workers soon.

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(Additional reporting by Ross Colvin; Editing by Dan Grebler)

WRAPUP 1-US employers likely added 5,000 jobs last month