This is an awful, awful number, comparable to the 602,000 lost in December, 1974 (and September’s figure was revised upward to a gigantic 403,000 job losses). In addition, the jobless rate rose to 6.7%. Professional economists were way off on this one, and it remains to be seen how much investors will be shellshocked by the figures. This crisis is clearly set to get worse, and with the Fed almost certain to cut rates later in the month–perhaps to zero–the impact of unprecedented, if often halfhearted or even confused, policy interventions continues to recede behind its scope, speed of impact, and scale. Obama and his economic team–including many who failed spectacularly to deal with the Asian crisis of the late ’90s (which eventually morphed into the dot.com and subprime crises)–will be in a desperate position well before they even take office.
November job losses steepest since 1974
Fri Dec 5, 2008 8:54am EST
WASHINGTON (Reuters) Employers axed payrolls by a shocking 533,000 in November for the weakest performance in 34 years, government data on Friday showed, as the recession inflicted a mounting toll on the U.S. labor market.
The Labor Department said the unemployment rate rose to 6.7 percent last month in the highest reading since 1993, compared with 6.5 percent in October, after widespread losses across the country’s major industry sectors.
November’s job losses were the steepest since December 1974, when 602,000 jobs were shed, and were much worse than forecast by analysts polled by Reuters who had predicted a reduction of 340,000 jobs.
In addition, October’s job losses were revised to show a cut of 320,000, previously reported as a 240,000 loss, while September’s losses were revised to a loss of 403,000 from down 284,00.
That meant 199,000 more jobs were lost in September and October than previously thought and the total reduction in U.S. nonfarm payrolls for last three months was 1.256 million, with almost 2 million shed in the year so far.
Service-providing businesses alone shed 370,000 jobs in November, following a loss of 153,000 jobs the month before.
The length of the workweek slipped to 33.5 hours, the shortest since records began in 1964, a Labor Department official said.
(Reporting by Alister Bull, Editing by Neil Stempleman)