FXstreet.com (Barcelona) - Job creation figures have been disappointing in January, well below the expert's forecasts of a sharp increase, while the unemployment rate has edged down slightly on the month, according to the latest data released by the US Department of Labor.

Non-farm employment posted a 17,000 decrease in January, when the experts had advanced increases between 50,000 and 100,000. Ian Shepherdson, Chief U.S. Economist High Frequency Economics, Ltd, thuis could be an advance of what is to come: a real sucker punch after the 130K jump in the ADP number. Big downward revisions to prior data too, see below. Private payrolls rose by 1K; the 18K drop in government jobs - all at the state level - is the first decline since July and may be a sign of what is to come as tax revenues drop.

The reasons for the decrease in payroll creation are the declines in construction (-27K), manufacturing (-28K) as well as the softening of work creation in private services , up 52K compared to three-month average of 118K

December's payroll data was revised sharply to a 82,000 increase, from the initially reported 18,000 rise.

The unemployment rate edged down to 4.9% from 5.o% on the previous month, the volume of employed persons remained in 7.6 million practically unchanged on the month.

Average hourly earnings have risen 0.2% in January from December, which means a $0.04 rise. On the year, average weekly earnings rose 3.7%. The average weekly hours have edged down to 33.7 in January from 33.8 in December.

According to Shepherdson we will se more declines in payrolls in the months ahead: In short, the labor market has been weaker, for longer, and it is now very soft indeed. Expect further declines in payrolls over the next few months. Finally, note hourly earnings up only 0.2% in Jan, 3.7% y/y, no inflation threat.