The government will release Friday its estimate of job growth and unemployment for January, providing another reading on the country's most urgent economic problem.
Most economists are forecasting that hiring picked up last month. The rate is now 9.4 percent, about twice what it was before the recession.
Speaking at the National Press Club on Thursday, Federal Reserve Chairman Ben Bernanke again warned it will be several years before the U.S. unemployment rate returns to normal levels, but he said there are some positive signs.
"Looking at the whole range of statistics on the labor market, the sense is that employers are becoming more willing to hire and I think we'll start seeing some stronger payroll reports and some lower unemployment rates pretty soon," he said.
Among those positive signs: lower initial claims for unemployment benefits. The latest report on initial claims, released Thursday, showed a steady downward trend continuing.
One factor holding down job growth in this recovery has been growth in productivity that is an increase in the amount a firm can produce with the same number of workers. The efficiency gains have been so great that the U.S. was able to return to its prerecession level of gross domestic product with about 7 million fewer workers on the job. A new report Thursday showed productivity growth accelerating.
But, Bernanke says, with consumer and business demand growing, that can't last forever.
"Now firms are beginning, 'Well wait a minute, we're now seeing enough increase in our sales and we have already exhausted the obvious productivity gains. ... It's time now to begin bringing on new workers.'"
Economists are predicting that about 145,000 new jobs were added to business payrolls in January. That would be an improvement from December when about 100,000 new jobs were added.
Up to now, Bernanke says, anxiety among employers about the durability of the recovery has meant many firms would only hire workers on a temporary basis.
"It'll be a really good sign when we see those temporary jobs being converted into permanent jobs and I'm hopeful that's where we're going to be heading in the next couple of quarters."
While striking an optimistic tone, Bernanke also acknowledged continuing risks to the economic outlook. The unrest in the Middle East, for instance, has the potential to raise oil prices significantly and hurt consumers.
"We're trying to stimulate the economy, we're trying to get consumers to become more confident, be able to spend more, and to help put people back to work," he said. "To the extent that part of their higher income gains are drained away by higher gas prices, that's going to be a negative and slow the recovery."
There are other risks, too, including the prospect that state and local governments struggling to balance their budgets will cut their workforces sharply and swell unemployment lines.
Boosting the rate of job growth is urgent, says Bernanke, because almost half of all unemployed Americans have been out of work for six months or more.
"What that means is that if they find work again in the future it could very well be at a much reduced wage or at part time," he said. "People who are not employed for a long period of time, they lose their skills, they lose their connections, they lose the knowledge of what's happening in their particular line of work, and so the consequences could last a very long time."
Bernanke says that the economy must grow at a rate of more than 2.5 percent a year to bring down unemployment. Forecasts suggest the U.S. economy will grow between 3 and 4 percent this year. That would likely bring the unemployment down, but not very rapidly. Copyright 2011 National Public Radio. To see more, visit http://www.npr.org/.