suzanne pratt takes a closer look at that december jobs report and the outlook for hiring in 2012. >> reporter: 8.5%. that's an unemployment rate the u.s. hasn't seen in nearly three years. and, it is something to celebrate. nearly every major industry created jobs in december, from retail to manufacturing. only the government sector trimmed its payrolls last month. some economists were also happy to learn that the length of the average workweek expanded to nearly more than 34 and a half hours. >> as the length of the workweek increases it puts upward pressure on future demand for labor and it also creates a lot more income for households which in turn will use that spend money and that simulates labor market demand. >> reporter: in the past year, the economy has added 1.6 million jobs. while that's the best year in the past five, there are still 13 million unemployed americans. and, there are another 6.5 million that have dropped out of the workforce, but would rather have a job. that may be hard to sense on manhattan's vibrant 42nd street. but in cities and towns across the country,

suzanne pratt reports. >> reporter: it's cleanup time in manhattan from this weekend's new year's eve celebration. but today on wall street, the partying was still going strong, making for a beautiful beginning to what could be a better year for stock investors. many market pros remain guardedly optimistic about 2012, but with the lackluster performance of stocks in 2011, it's questionable whether small investors will even tiptoe back in. and if this manhattan ameritrade office is any indication, at least some are taking a wait and see attitude. >> i don't feel that confident in the market just yet. maybe in a few years, the market will turn around, but as of yet, it's still up and down. >> yeah, there might be ups and downs, but it will be volatile. for someone in my age, it's not the right haven. >> reporter: ameritrade branch manager jeff goldberg says the good news is that small investors are more savvy about their portfolios. >> i think they know there's going to be volatility in the market. and they don't necessarily fear it, but they understand it better and they try to develop

suzanne pratt explains why. >> reporter: it's hard to imagine there could ever be a period when tech companies weren't super-profitable. after all, technology touches almost every aspect of our lives, from the way we stay in touch to how we amuse ourselves. but, analysts believe earnings growth for most tech names cooled in the fourth quarter. and, there were some headwinds affecting those profits, all blowing from the same place. >> number one, weakness originating from and around europe. two, related currency headwinds. three, enterprises taking more time to sign and execute on deals. >> reporter: still, a stronger u.s. economy and decent holiday sales helped counteract some of europe's negative affects. but, when the numbers come, in profits for the sector likely rose just 1.6% in q4, that's half of the expected gain for all companies in the s&p 500 index. on top of that an even tinier increase is expected for tech earnings in the current quarter. experts predict europe's problems will continue to plague tech companies this year. >> 2012 is going to be a harder year for the techno

suzanne pratt reports. >> reporter: the outlook for treasuries this year is something of a mixed bag, but that hasn't stopped people from coming to investment offices like this one to pour millions of dollars into bonds. it's no wonder investors are still enamored of bonds. last year, treasuries returned about 10%, beating corporates and stocks. after all, u.s. government bonds have long been regarded as a safe haven. for that reason, some experts predict treasuries will be a good bet this year, and with europe still in turmoil, there are even fewer risk-free investments. >> you no longer have a lot of european peripherals, and even some of the european core countries are no longer considered safe. all of that in an environment where more and more people are buying bonds, so that's very supportive of the treasury market overall. >> reporter: but, concerns in the market are growing about a stronger u.s. economy. with that often comes inflation, an enemy of bonds. still, at least so far, the good economic news has yielded a big ho-hum. >> what is interesting is that the treasury market

suzanne pratt has the story. >> all choices lead you somewhere. bold choices take you where you're supposed to be. >> reporter: thanks to a hip and cool new image, liquor, not beer, has become the choice of many alcohol drinkers. so much so that spirits sales continue to gain ground on their fizzy rival. >> what i've seen lately, actually, the trend is as far as buying spirits, it's more higher end spirits, looking at single- malt scotches, the higher-end rums, and some higher-end vodkas as well. >> reporter: in 2011, spirits accounted for more than a third of the u.s. alcohol market. a decade earlier, spirits had less than 28%. and it's beer, not wine, that's been slipping. spirits trade association c.e.o. peter cressy also credits greater cultural acceptance of hard alcohol, like bourbon, vodka and tequila. >> a really nice, well-made cocktail is a thing of art. you watch a really good bartender at one of the great bars here in new york or elsewhere, it's really pretty special. >> reporter: bars like this one are where spirits are frequently con

but, as suzanne pratt reports tonight, the airline industry still is likely to experience turbulence in the months ahead. >> reporter: it looks like the skies are getting friendlier for u.s. airlines. after a decade-long downturn, that resulted in at least a few bankruptcies, the airline industry is making money again. >> airlines have been working for the last two years to conform to the new fuel reality of $1,900 fuel. this is the first quarter i think we really feel they have the formula down. >> reporter: that formula includes higher airfares and fewer flights for passengers. both, however, have helped increase revenue for many airlines, even though the u.s. economy remains somewhat weak. analysts say the united- continental merger, as well as the delta-northwest marriage, have also paid off for the carriers in terms of cost- cutting. and, as a result, more consolidation is expected, particularly for american airlines parent-- a.m.r.-- in the midst of bankruptcy reorganization. >> all eyes now on a.m.r., and we're just hearing more reports about u.s. airways' interest in a.m.r.,

suzanne pratt, "nightly business report," new york. >> unless some miracle happens and we get some sound economic policies out of washington and europe, i just don't see how we avoid the upcoming train wreck. >> tom: still ahead, find out why this stock market expert thinks the market is headed for a big drop. the major indices tried to dig >> tom: before the big numbers out from apple, the major indices tried to dig themselves out of a hole. let's get to it tonight with market focus. the major indices tried to dig themselves out of an early hole, ending the day mixed. thanks to the discouraging news out of greece, u.s. stocks were hit from the opening bell. but the market was able to trend up from that deficit, but remained in negative territory for the entire session. leading the market lower was the telecom services sector, down more than 1%. utilities and consumer staples-- each traditionally defensive sectors-- dropped. sprint led the losers in telecom, sliding 3.5%. j.p. morgan cut its forecast for sprint over worries iphone promotions from sprint's competitors led to lower custome

suzanne pratt explains. >> reporter: big is what you think of when it comes to office depot. most of the company's 1100 u.s. locations are 25,000 square feet. but, that's not true of one of office depot's newest stores, based in hoboken, new jersey. it's a fifth of the size of its larger brethren and part of company's new strategy to improve profitability. there are now eight mini stores like it in the u.s. north american president kevin peters says the big stores simply aren't working. >> customers were looking for a much smaller, more intimate shopping experience. most importantly a shopping experience that would allow them to get in, get what they need and get out. >> reporter: the small stores offer half the products found in the larger ones, but can do 90% of the sales. >> it's more profitable for two reasons. one, we're paying less in occupancy costs, and two are margins are a little bit higher because we have a full suite of services. >> reporter: other big box stores like staples and best buy are using the same strategy, opening smaller operations in urban centers lik

suzanne pratt, "nightly business report," new york. >> tom: with apple dominating the smartphone business, the former leader of the pack is struggling. word today that research in motion has hired goldman sachs to help it explore its options. rimm is the maker of the blackberry devices, once the standard in mobile email devices, but it's run into a series of disappointments. pl tsbole iof playbook tablet to delaying its newest blackberry line of devices until next year. over the past year, the stock has lost three-quarters of its value, even though it rallied almost 6% today. meanwhile we're also seeing interest in the bankrupt parent of american airlines, a-m-r. the company went bust in november, looking to restructure its debt and cut its labor costs. it was the last of the major legacy carriers to declare bankruptcy. reports indicate there are two possible buyers, delta airlines and private equity firm t.p.g. capital. ray neidl is an analyst with calyon securities. welcome back. we should add one more name. late today it broke that us airways may be involved. let's tackle the cariers,

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