Washington: Companies in the US probably cut more jobs last month and the unemployment rate increased, indicating the labour market in the world's largest economy is still struggling to rebound, economists said before a government report this week.

Payrolls probably fell by 50,000 after declining 20,000 in January, according to the median forecast of 62 economists surveyed by Bloomberg News before the Labour Department's March 5 report. The unemployment rate may have increased to 9.8 per cent from 9.7 per cent. Winter storms last month may have contributed to a lower payrolls number, some economists said.

A lack of job growth since the economy began expanding again in mid-2009 is making for an uneven recovery from the worst recession since the 1930s. Companies are reducing head count to trim costs, a trend that's likely to restrain consumer spending in coming months.

"Even leaving aside the effects of inclement weather, the economy still appears to be shedding jobs," said Aaron Smith, a senior economist at Moody's Economy.com in West Chester, Pennsylvania.

Hesitant

"Although businesses have stopped cutting inventories and are beginning to invest more, they have been more hesitant to increase their hiring."

Job growth, and the wage gains that accompany it, are needed to further fuel consumer purchases, which account for about 70 per cent of the economy.

After the creation of 64,000 jobs in November, the first monthly increase in almost two years, payrolls fell in December and January. The economy has lost 8.4 million jobs since the recession began in December 2007, the most of any downturn in the postwar era.

Federal Reserve Chairman Ben. Bernanke told Congress last week that there were "tentative" signs of stabilisation in labour markets, such as fewer job losses and a gain in factory employment last month.

"Notwithstanding these positive signs, the job market remains quite weak, with the unemployment rate near 10 per cent and job openings scarce," Bernanke said.

The economy is in a "nascent" recovery that he said will require low interest rates.

US stocks have declined this year, due in part to signs the economy is struggling to accelerate. The Standard & Poor's 500 Index and the Dow Jones Industrial Average are both down one per cent so far this year.

The jobless rate probably increased for the first time since October, the survey median showed. The rate is forecast to end the year at 9.5 per cent, according to the median estimate of economists surveyed last month.

Snowstorms that crippled portions of the East Coast earlier last month may cause the February payroll numbers to look worse than they otherwise would be, some economists said. The job losses associated with the blizzards may result in a bigger gain in March payrolls, they said.