By  on February 5, 2010

WASHINGTON — Apparel retailers added 23,600 jobs in January, running counter to a decline in payroll levels nationwide as most employers lacked the confidence to hire full-time workers.

Clothing and accessory stores hired 13,300 workers last month to employ a total of 1.37 million. Department stores added 10,300 jobs to reach 1.47 million, the Labor Department said Friday.

Department stores, clothing stores and grocery stores led retail industry employment gains, said Sandy Kennedy, president of the Retail Industry Leaders Association. The entire retail sector, including apparel retailers, added 42,100 jobs in January, the Labor Department said.

Retailers could be responding to early indications that the job market is on the verge of improving, said Phillip Swagel, visiting professor at McDonough School of Business at Georgetown University and a former economist for the Treasury Department. Wages have started rising, the number of hours worked is beginning to increase and temporary employment picked up, he said.

“That then spills over and shows at the cash register,” and that in turn leads to retail hiring, Swagel said.

Despite some positive signs in the retail industry, overall payrolls declined by 20,000 jobs in January, the Labor Department said. The unemployment rate dropped to 9.7 percent from 10 percent the previous month. Economists attributed the decrease to a combination of more people saying they had found jobs and seasonal adjustments to the data that account for reduced hiring during winter.

“The jobs report suggests that the economy is on the verge of creating jobs, but the improvement is likely to be gradual, suggesting that the welcome drop in the unemployment rate can’t yet be taken as the start of a trend,” said Nigel Gault, chief U.S. economist for IHS Global Insight.

Since the recession began in December 2007, the U.S. economy has lost 8.4 million jobs, more than 4 million of them in 2009.

“The overall loss in jobs during the recession is far worse than first announced,” Gault said.

In the manufacturing sector, apparel makers added 3,000 jobs to employ a total of 169,600. Textile mills, which make apparel fabric, cut 1,700 positions, and textile product mills, which make home furnishing and industrial fabrics, trimmed 100 jobs. The reductions brought staffing levels in both sectors to 121,600 workers.

The overall manufacturing sector increased its payrolls for the first time since January 2007, Gault said, despite the continued decline in textile jobs.

“While unemployment remains a severe problem, [Friday’s] employment report contains encouraging signs of gradual labor market healing,” said Christina Romer, chairwoman of the President’s Council of Economic Advisers.

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