The News Courier in Athens, Alabama

State and Nation

March 8, 2013

Job gains cut unemployment to 7.7 pct., 4-year low

(Continued)

The improved job market can also benefit countries that sell goods and services to U.S. consumers and businesses.

"All you have to do is look at the trade numbers," says Bernard Baumohl, chief global economist at the Economic Outlook Group. "The strength in the U.S. economy is leading to faster growth in imports."

Imports rose 2 percent in January from December. Those from China surged 7 percent.

A stronger U.S. economy, Baumohl says, will also help a battered Europe, which is contending with high unemployment and a debt crisis. The United States is the No. 1 market for exports from the 27-country European Union.

"The extent to which the U.S. is recovering and potentially the labor market is improving is potentially an important dynamic that Europe would welcome," said Nick Matthews, an economist at Nomura in London.

The U.S. economy is benefiting from the Federal Reserve's drive to keep interest rates at record lows. Lower borrowing rates have made it easier for Americans to buy homes and cars and for companies to expand.

The Fed and key central banks overseas have taken extraordinary steps to pump money into their financial systems to try to spur borrowing and spending, boost stock prices and stimulate growth.

The Fed has said it plans to keep the benchmark rate it controls near zero at least until the unemployment rate has fallen to 6.5 percent, as long as the inflation outlook remains mild.

Friday's jobs report isn't expected to move up the Fed's timetable for any rate increase.

The brighter hiring picture has yet to cause a flood of out-of-work people who aren't looking for a job to start seeking one. The proportion of Americans either working or looking for work dipped one-tenth of a percentage point in February to 63.5 percent, matching a 30-year low.

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