U.S. job market is grimmer; jobless rate is 6.7%
Holiday gifts for 533,000 workers are pink slips
By Tom Stundza -- Purchasing, 12/5/2008 9:20:00 AM
The U.S. economy has lost 1.9 million jobs through November as the employment market deteriorated last month in the deepening recession that has engulfed the country. Nonfarm payrolls plunged a larger-than-expected 533,000 in November, the U.S. Labor Department reports today. Job losses were large and widespread across the major industry sectors so the unemployment rate, which is calculated using a separate survey of households, rose 0.2 percentage point to 6.7%, the highest since October 1993.
The government report points out that since the start of the recession in December 2007, as recently announced by the National Bureau of Economic Research, the number of unemployed persons nationwide has increased by 2.7 million, and the unemployment rate rose by 1.7 percentage points.Dow Jones & Co. says this morning that latest figures suggest the year-long U.S. recession may approach or even exceed the 1981-1982 downturn in severity.
Another 16,000-plus job will be cut later this month of in early 2009 as AT&T Inc., DuPont Co., Viacom Inc., Pratt & Whitney, ArcelorMittal, U.S. Steel, Adobe Systems, Cliffs Natural Resources Inc. and Greif Inc. this week announced they will cut jobs. Also paring jobs are Bank of America, JPMorgan Chase & Co. and General Electric Co. Andrew Gledhill, an economist with Moody's Economy.com, tells the Columbus Dispatch newspaper in Ohio: “What we have seen is not just that the cuts are deep; it's that they are happening everywhere. It just tells you that there are very few people in any industry who can say, 'I feel safe'.”
According to this morning’s Labor report, hiring last month in goods-producing industries fell 163,000 because of the weak economy. Within this group, manufacturing firms cut 85,000 jobs, with automobile and auto parts makers accounting for 13,000 job losses. Construction employment was down by 82,000.
In a particularly worrying sign, service-sector employment plunged 370,000. Labor-intensive services make up the vast majority of employment and usually cushion downturns. Yet business and professional services companies shed 136,000 jobs -- the 10th drop in 11 months -- and financial-sector payrolls were down 32,000.
Retail trade cut over 91,000 jobs, reflecting the pullback in consumer spending. Leisure and hospitality businesses, meanwhile, shed 76,000 jobs. Temporary employment, which economists consider a bellwether for future job prospects, fell more than 78,000.
Continuing a recent trend, the main bright spots were in health care and education, which tend to be more labor intensive and less productive than manufacturing and other services. Employment in those sectors rose 52,000. The government added 7,000 jobs.
Where are the jobs?
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