US recovery effort stumbles as 263,000 jobs lost (How is the Hope and Change working out for you all?)
WASHINGTON (AFP) – US economic recovery hopes got a rude shock Friday as official data showed job losses accelerated to 263,000 in September and the unemployment rate rose to 9.8 percent.
The Labor Department report, one of the best indicators of economic momentum, showed the critical labor market reversed course after months of improvement.
The unemployment rate was up one-tenth of a point from August and in line with most forecasts, but would have been higher if not for 571,000 people dropping out of the labor force.
But payroll losses were far worse than expectations for a loss of 175,000 jobs. The number of job cuts rose sharply after a revised loss of 201,000 in August.
“This confirms that this is going to be a frustratingly slow recovery and it’s not going to make a lot of people happy for a long time,” said Robert MacIntosh, economist at Eaton Vance.
“We’ve had some recovery by rebuilding inventories and we had a one-time boost with ‘cash for clunkers’ (auto buying incentive) but all that did was take sales from future months.
“This economy needs to grow on its own and it’s going to take a long time.”
Cary Leahey, senior economist at Decision Economics said that “what makes it disappointing is that every major component is weak.
“Job gains have stalled, the unemployment rate remains high and the smaller parts of the report were also disappointing,” Leahey said.
The report showed the average workweek in the private sector edged down by 0.1 hour while wages were up a tepid 0.1 percent, or 2.5 percent annualized.
Leahey said these details show weakness going forward which will prompt the Federal Reserve to keep interest rates near zero.
(Excerpt) Read more at news.yahoo.com …
If you enjoyed this post, please consider to leave a comment or subscribe to the feed and get future articles delivered to your feed reader.
Comments
No comments yet.
Leave a comment