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Economy adds jobs and wages break out of the doldrums

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Companies added 257,000 new jobs in January, more than many economists predicted, and there was evidence in U.S. Labor Department reports that an influx of hiring over the past year may be pushing up wages after years of sluggish growth, MarketWatch reported.

 

The pace of hiring accelerated sharply during the winter, including the biggest increase in private-sector job creation since 1997. An average of 336,000 jobs were added in each of the past three months, including a 423,000 gain in November, revised government figures show.

 

Most industries added jobs, another sign the economy has shifted into a higher gear. For example, construction companies hired 39,000 employees, health-care providers created 38,000 jobs and manufacturers added 22,000 workers.

 

The unemployment rate, meanwhile, edged up to 5.7 percent from 5.6 percent, but that’s because more people looked for jobs in response to a healthier job market.

 

U.S. stock futures rose after the release of the employment data, which topped the MarketWatch-compiled economist forecast for 230,000 job gains. The yield on the 10-year Treasury also edged higher.

 

In another good sign, average hourly wages jumped 0.5 percent in January to $24.75 after declining in December. That’s the biggest gain in six years. Several state minimum-wage increases kicked into effect last month.

 

Hourly wages have risen 2.2 percent in the past 12 months, up from 1.9 percent in December and just a notch below a post-recession high.

 

The amount of time people worked each week also remained at a post-recession high of 34.6 hours.

 

The economy has now added at least 200,000 jobs for 12 straight months, a feat last accomplished in the 1994-1995 period. Hiring shows little sign of slowing down despite weaker economic growth around the world.