Unemployment rate dipped to 9.7 percent as job loss slowed down

The U.S. economy lost 20,000 net jobs during January, while the unemployment rate dipped to 9.7 percent in the month, from 10 percent in December, the government reported Friday.

The slowing pace of job loss provided signs that the economy was recovering after the longest recession since the Great Depression.

While construction companies and state and local governments cut back, manufacturing added 11,000 jobs in January, the first time in three years.

Despite encouraging indications for the future, the government’s monthly snapshot of the labor market revealed that last year’s collapse was considerably more severe than previously recorded. The Labor Department revised previous data to show that the economy contained 1.36 million fewer jobs in December, a downward adjustment of roughly 1 percent. The revisions showed the economy lost 150,000 jobs in December, far more than the 85,000 initially reported.