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Payrolls increased in 39 states in January led by California

[WASHINGTON] Payrolls rose in 39 states in January and the unemployment rate fell in 24 as the US labor market continued its acceleration.

California led the nation with a 67,300 increase in employment, followed by a 25,100 advance in Ohio, figures from the Labour Department showed Tuesday in Washington.

Job growth is a bright spot in the US, as economic gauges from consumer spending to factory output have slowed amid inclement weather, sluggish growth abroad and limited wage gains for American workers. Employers will need demand for their goods and services to pick up in order to justify expanding headcount in the months ahead.

"The pace is running pretty hot right now," Sarah House, an economist at Wells Fargo Securities LLC in Charlotte, North Carolina, said before the report. "We're at a particularly good point in the cycle - there's may be some catch-up going on from previous years."

Nonetheless, "it's going to be tough to grow employment by 2 per cent forever," Ms House said, citing the gain in total payrolls last year, which was the best since 1999.

Idaho showed the biggest per centage gain in employment with a 1.4 per cent increase, followed by Hawaii at 0.9 per cent. States where payrolls fell included Virginia, Minnesota and Louisiana.

The unemployment rate in January dropped the most in Oregon, where joblessness fell to 6.3 per cent from 6.7 per cent in December. No states showed a statistically significant increase in unemployment.

North Dakota had the lowest jobless rate in the US at 2.8 per cent in January. Mississippi and Nevada tied for the highest at 7.1 per cent.

The slump in oil prices hasn't yet led to widespread job losses. Payrolls in North Dakota climbed by 1,300 workers in January, while Texas showed a 20,100 increase, according to the report.

State and local employment data are derived independently from the national statistics, which are typically released on the first Friday of every month. The state figures are subject to larger sampling errors because they come from smaller surveys, thus making the national figures more reliable, according to the government's Bureau of Labor Statistics.

The national report showed payrolls across the US climbed by 295,000 in February following a 239,000 increase the month before. The unemployment rate fell to 5.5 per cent, the lowest in almost seven years and at the range that Federal Reserve officials consider full employment.

State employment figures for February are due March 27.

"Important progress" has been made toward the Fed's goal of maximum employment, Fed Chair Janet Yellen said in Feb 24 testimony to Congress. Still, "too many Americans remain unemployed, wage growth is still sluggish and inflation remains well below our longer-run objectives."

Fed officials are weighing labor market data as they decide the timing of their first interest rate increase since 2006. The central bankers are expected to release a statement and projections following the conclusion of two-day meeting in Washington on Wednesday.

One report Fed officials watch closely - the Job Openings and Labor Turnover Survey - showed vacancies at US employers rose to 5 million in January, a 14-year high.