WASHINGTON — Fashion retailers presented a mixed employment picture in December and U.S. producers continued to post declines, as tepid overall job growth and a jump in unemployment sparked concern of a worsening economic forecast.

Posting the slowest growth in more than four years, the economy added a seasonally adjusted 18,000 new jobs in December, after increases of 115,000 in November and 159,000 in October. The unemployment rate ticked up to 5 percent from 4.7 percent, hitting its highest mark since November 2005.

On the fashion front, the timing of seasonal help for what turned out to be a lackluster holiday season appeared to influence the figures. Apparel and accessories stores cut their payrolls by 7,900 last month to 1.5 million after adding 13,600 positions in November. Moving in the opposite direction, department stores added 4,800 workers in December for 1.5 million, after cutting 5,700 positions the previous month.

“A lot of this is correcting the hiring anomalies from November, which were probably due to the early Thanksgiving,” said David Wyss, chief economist at Standard & Poor’s, who noted department stores likely waited longer than their specialty counterparts to add seasonal workers.

The broader employment trends are pointing to a tough first half for retailers, he said.

“The labor market’s deteriorating,” said Wyss.

Domestic producers continued their decline in the face of foreign competition. Apparel producers cut employment by 1,900 to 208,800, while textile mills trimmed payrolls by 2,200 to 163,500 and textile product mills eliminated 1,500 positions for a total of 150,500.

Consumer spending is largely supported by people’s job prospects and accounts for roughly two-thirds of the economy.

“This data show an economy slowing sharply,” said Nigel Gault, chief U.S. economist at Global Insight, in an analysis. “The first quarter of 2008 is shaping up as a negative quarter for [gross domestic product] growth — and the risk of recession is rising sharply.”

The jobless figures worried investors, driving the Dow Jones Industrial Average down 2 percent to 12,800.18 on Friday.

However, the jobs report is subject to statistical anomalies and might be giving a skewed take on the economy.

This story first appeared in the January 7, 2008 issue of WWD.  Subscribe Today.

“Ultimately, we will see this was a temporary and largely weather-influenced report,” said Richard Yamarone, chief economist at Argus Research Corp., noting that more than 50,000 people were unable to make it to work due to weather when the survey was taken and were therefore not counted as on the payrolls.

“I do think we’re creating jobs,” said Yamarone. “I don’t think that it’s going to be at a blistering pace, but I don’t think that we’re headed toward a recession anytime soon.”

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