US economy races ahead of Europe

Washington: The latest surge in US job creation suggests the world's biggest economy is gathering momentum — in contrast to the recession taking hold in parts of Europe.

Analysts said that in the US, where the economy added 243,000 net new jobs in January to pull down the unemployment rate to 8.3 per cent, the flexibility of the labour market was key.

Economists said the American economy is shaking off the debt woes of the Eurozone, where unemployment has hit 10.4 per cent, the highest since the creation of the single currency.

Some 1.9 million US jobs have been created in the past five months, bringing the number of people working nearly back to the levels of late 2008.

Economist Jacob Kirkegaard said the latest developments in the labour market show the resilience of the US economic model.

"When you're a US employer, you barely hesitate to hire because you know if you take a worker for a peak in business, you can easily lay off that person if it doesn't turn out as planned," he said.

High costs

"In Italy, in Spain, in France, in Greece, the costs for that are high." The National Association of Manufacturers said the latest US numbers "show renewed strength in the domestic economy, with employment growth in almost every major industrial sector except information, financial services and government."

Alexandre Douzet, president of recruitment firm The Ladders, said he sees considerable momentum in the US, with many companies planning to hire.

"This is true for sectors which up to now have been retrenching or cutting their staffs," such as retailing and construction, he told AFP.

"No one wants to say this in public, but all the US chief executives are saying privately that 2012 will be a good year." Job gains have averaged 201,000 a month the past three months and some economists say the broad improvement reflects a rebound from the woes that derailed last year's labour recovery.