Just last month, the December report showed an anaemic 18,000 rise in payrolls, prompting a downturn in stock market that led to one of Wall Street’s worst January performances ever. On Friday, the Labour Department raised that estimate to a gain of 82,000 jobs.

The unemployment rate in January fell back slightly, to 4.9 per cent, after jumping to 5 per cent in December. But that was one of few strong spots in the report. Payrolls at private companies increased by a mere 1,000 jobs. Businesses are reducing the number of hours that their employees work. And workers' salaries have effectively fallen in the last 12 months. The average hourly wage for rank-and-file workers — about 80 percent of the total work force — rose 3.7 percent since last January. Average hourly earnings ticked up 0.2 percent last month, slowing from a 0.4 percent rise in December.

Some economists said the poor report meant the Federal Reserve made the right move in aggressively cutting interest rates over the last two weeks.