The nation's civilian unemployment rate rose in January for the second consecutive month, from 7.2 percent to 7.4 percent, bringing the number of unemployed back up to the levels of last summer, the Labor Department reported yesterday.
The number of people without jobs increased by 293,000 last month, according to the government survey of households, raising the number of unemployed to 8.5 million, about the same number as last July and August.
However, the Labor Department's survey of businesses' payrolls, which many economists said was generally more reliable than the household poll, showed that businesses increased employment by 350,000. Many analysts considered this a strong gain.
Government and private economists yesterday said the increase in jobs in the payroll survey showed that the economy still has a great deal of strength. However, economic growth will have to exceed 3.5 percent this year to absorb all of the new job seekers entering the labor force and prevent the unemployment rate from rising further. Many economists are predicting a growth rate this year of about 3 percent to 3.5 percent.
The unemployment rate in January was slightly below the 7.5 percent rate when President Reagan took office four years ago. The civilian rate increased from 7.1 percent in November to 7.2 percent in December.
When members of the armed forces stationed in the United States are counted, the unemployment rate last month increased from 7.1 percent to 7.3 percent.
White House spokesman Larry Speakes said the administration was "disappointed" at the rate increase, which it said "represents end-of-the-year volatility." He said the administration believes "the economy is strong and growing and will continue to create jobs in 1985."
Janet L. Norwood, commissioner of the Bureau of Labor Statistics, said that while too much shouldn't be read into one month's statistics, "It's going to be very difficult to reduce unemployment if the labor force continues to grow at a 3.5 percent rate a year or so." That is the average rate in employment growth since the recession ended 26 months ago.
Norwood, appearing before the Joint Economic Committee yesterday, was asked whether the unemployment picture would improve much if economic growth increased at a 3 percent rate next year -- the rate assumed by many economists. "It would be very difficult" to get any improvement in unemployment, Norwood said. "It certainly would."
JEC Chairman Rep. David Obey (R-Wis.) said, "What distresses me is that, this far into the recovery, we have still a large number of people falling into the cracks. It certainly indicates this country hasn't learned how to really deal with the unemployment rate without stirring up inflation."
Economists yesterday said they were not discouraged by the economic data and still expected the unemployment rate to edge down during the year. However, in light of other recent economic statistics, many economists said they don't expect economic growth to be as strong this year as they earlier predicted, making it unlikely that the unemployment rate will improve markedly this year.
The increase in the unemployment rate was the third piece of bad economic news released recently in an otherwise optimistic climate. The government reported last month that economic growth had emerged from its summer slump with output of goods and services increasing at a 3.9 percent rate in the fourth quarter of last year, compared with 1.6 percent in the third quarter.
At the same time inflation remained below 4 percent for the best showing in 17 years, increasing confidence among economists that the economy would continue growing at a good clip this year.
The government reported yesterday that new construction rose 0.9 percent in December and spending for the year was up 19 percent over 1983. After adjusting for inflation, spending increased 14.7 percent, the Commerce Department said.
However, the government also reported this week that the nation chalked up the largest trade deficit in history -- $123 billion -- and that the main gauge of future economic activity declined in December, the fifth drop in seven months.
"I think it's a kind of a mixed pattern that you might expect as the economy enters its advanced third year of economic expansion," said David Jones, chief economist for Aubrey G. Lanston & Co. Inc. "But I'm not for a minute suggesting that everything is perfectly fine. The economy is not growing too fast, it's not growing too slow. The momentum of the economy is still favorable."
The number of civilians employed last month was 106.4 million, about the same as in December, the Labor Department said. The proportion of the civilian population with jobs was 60 percent, the highest level in five years.
The unemployment rate for men was unchanged at 6.3 percent and the rate for women rose from 6.4 percent to 6.8 percent, the Labor Department said. The teen-age unemployment rate rose from 18.8 percent to 18.9 percent.
The rate for blacks fell from 15 to 14.9 percent and the rate for whites increased from 6.2 percent to 6.4 percent. The rate for Hispanics rose from 10.4 percent to 10.6 percent.