Plus: Factory Orders on the Rise, China Breaks Auto Sales Record and Global Electronics Demand Rebounds.

Unemployment Rate Falls in December
The United States private sector added 103,000 jobs last month, substantially driving down the national unemployment rate from 9.8 percent in November to 9.4 percent in December, the lowest level in 19 months, the U.S. Department of Labor reported Friday. However, signs indicate the job market may be lagging too far behind to make sustainable employment gains.

“The sharp drop in unemployment from November’s 9.8 percent rate blew most economists’ expectations out of the water,” Agence France-Presse reports. “But just 103,000 non-farm jobs were created, many fewer than the 150,000 expected, reaffirming a trend of steady but unspectacular job growth.”

Although the jobless figure is at its lowest level since May 2009, experts attribute much of the decrease in the unemployment rate to a shrinking workforce. Combined with sluggish job creation that fails to meet hiring expectations, December employment conditions may actually be indicative of deeper problems.

“The decline in the jobless rate, paradoxically, was partly a sign of economic weakness — many people have given up on finding jobs, and thus were not counted as unemployed,” the Wall Street Journal explains. “Some 8.4 million jobs were shed during the recession, and in 2010 just 1.1 million were added. At December’s pace, it would take 70 months — or until late 2016 — to make up for the rest of the jobs lost.”

The largest job gains last month were in the leisure and hospitality industries, food services and health care. The manufacturing industry added 10,000 jobs in December, although net employment has remained relatively flat since May. The construction industry shed 16,000 jobs, mostly in heavy and civil engineering, while mining grew by 5,000 jobs.

U.S. Factory Orders Rise in November
New orders for U.S. manufactured goods rose by 0.7 percent ($3.2 billion) in November, led by demand for primary metals and consumer spending on computers and other electronic products, according to the U.S. Department of Commerce last week. New orders, up four of the last five months, climbed to $423.8 billion for the month. Excluding the transportation industry, new orders increased 2.4 percent.

“Manufacturing activity has expanded in every month since the recession officially ended in June 2009. Analysts said November’s increase in factory orders should translate into further gains in production in 2011,” the Associated Press explains. “Consumers are coming off the busiest holiday shopping season in four years. Businesses are anticipating stronger economic activity to continue this year, helped by a tax cut that will put more money in consumer’s pockets.”

New orders for manufactured durable goods, down three of the last four months, fell 0.3 percent in November following a 3.1 percent drop in October. Transportation equipment had the largest decline, decreasing 11.1 percent to $46 billion. However, orders for manufactured non-durable goods rose 1.7 percent to $228.2 billion.

Total shipments, up three consecutive months, increased 0.8 percent to $424.5 billion in November, following a 0.4 percent rise in October. Unfilled orders rose 0.6 percent to $826.9 billion, while inventories increased 0.8 percent to $543.8 billion. Both unfilled orders and inventories have increased 10 of the last 11 months.

Manufacturing has also experienced steady growth worldwide. The JPMorgan Global Manufacturing PMI, a key indicator of international factory activity, reached a six-month high of 55 in December, pointing to “a robust improvement in overall operating conditions.” New orders hit a seven-month peak, with higher levels of business reported in the U.S., the Eurozone and China. Greece and Japan were the only countries to report manufacturing declines in December.

China Breaks Auto Sales Record in 2010
“China’s vehicle sales jumped 32 percent in 2010 as government stimulus measures and economic growth helped the nation stay the world’s largest auto market for a second year,” Bloomberg News reports. Total auto sales, including cars, trucks and buses, rose to 18.06 million units, while passenger-car deliveries jumped 33 percent to 13.8 million, according to the China Association of Automobile Manufacturers (CAAM).

In December alone, total vehicle sales rose 18 percent from a year earlier to 1.67 million vehicles, while sales of passenger vehicles rose 19 percent to 1.3 million units, CAAM reported.

“Domestic brands accounted for 46 percent of passenger-vehicle sales in China last year, up from 44 percent in 2009,” Zhu Yiping, deputy secretary general of the association, said at a news conference. (Source: The Wall Street Journal)

China passed the United States in 2009 as the biggest market by number of vehicles when the global financial crisis battered American sales. Chinese auto sales also surged in early 2010 after Beijing cut sales taxes and offered subsidies to buyers of smaller, fuel-efficient vehicles.

In 2011, however, auto sales in China are “set to cool…as rising fuels prices, the removal of subsidies and tighter rules on new car registrations temper demand in the world’s largest car market,” Reuters says.

Global Electronics Sales to Jump in 2011
Consumer electronics revenues had a stronger-than-anticipated 2010, having rebounded last year with growth that doubled earlier projections, according to the Consumer Electronics Association (CEA) last week. The industry is expected to have ended 2010 with six percent revenue growth, reaching $180 billion.

Innovative new products like smart phones, tablets and electronic book readers helped spur consumer interest and brought stronger-than-expected growth throughout the year.

Moreover, in its semi-annual industry forecast, the CEA forecasts the industry to reach a record high in 2011, with revenues exceeding $186 billion. Global retail sales of consumer electronics devices are projected to grow 10 percent this year to reach $964 billion, according to the CEA, which said global gadget sales may top $1 trillion this year for the first time ever.

Smart phones generated nearly $18 billion in shipment revenue, with more than 55 million unit sales in 2010. In 2011, smart phone revenues are expected to increase nearly 20 percent to more than $21 billion and 72 million units are projected to ship to dealers.

The CEA estimates that 17 million tablet computers were sold in 2010. The association forecasts tablet computer sales will double this year over last year to around 30 million units.

Tablets and smart phones dominated headlines at the Consumer Electronics Show (CES) in Las Vegas last week. Dell Inc. unveiled several new tablet-style computers and a smart phone. The Chicago Tribune reports Motorola Mobility is claiming to have unveiled “the world’s most powerful smart phone” that “seems to blur the lines between smart phone and tablet,” while the Associated Press notes that Motorola Mobility also debuted a more traditional tablet computer, as well as several new smart phones.

Taiwan’s AsusTek Computer Inc. plans to start selling an array of tablet computers, “including hybrids that sit somewhere between a laptop and a tablet.” The Journal‘s Digits blog also reports on the myriad tablet announcements happening at CES, including the T-Mobile G-Slate with Google, an Android tablet from T-Mobile USA and LG Mobile Phones; a similar offering is on the way from Motorola and AT&T.

Meanwhile, there will also likely be 19 million e-readers sold this year, according to the CEA.