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Grim data show U.S. has been hemorrhaging jobs all summer
By Jeannine Aversa
Associated Press
Published on Saturday, Sep 06, 2008
WASHINGTON: The nation's unemployment rate zoomed to a five-year high of 6.1 percent in August as employers slashed 84,000 jobs.
The Labor Department's report released Friday showed the increasing toll that the housing, credit and financial crises are taking on the economy.
With the employment situation deteriorating, there's growing worry that consumers will recoil with less spending, hurting the economy later this year or early next year.
The jobless rate jumped to 6.1 percent in August, from 5.7 percent in July. Employers cut payrolls for the eighth month in a row. Also, job losses in June and July turned out to be much deeper than the preliminary figures that were released. (The job figures for August will be subject to revision in upcoming months as well.)
The economy lost 100,000 jobs in June and another 60,000 in July, according to the revised figures. Previously, the government reported job losses at 51,000 in each of those
months.
So far this year, job losses have totaled 605,000.
The latest snapshot was worse than economists were forecasting. They were predicting payrolls would drop by around 75,000 in August and the jobless rate would tick up a notch, to 5.8 percent.
Even as the unemployment rate has increased this year, economists disagree on what constitutes ''full employment'' nationally. For instance, some say full employment would have an unemployment rate that ranges between 4.5 and 5 percent, while others say the range should be between 4.5 and 6.4 percent.
State, region struggling
In Ohio, the state reported last month it had a 7.2 percent unemployment rate in July. That was the highest rate since it was 7 percent in January 1993. The highest one-month rate since 1970 was 13.8 percent in January 1983.
Summit County's unemployment rate rose to 6.7 percent in July, up from 6.2 percent in June.
Akron's unemployment rate rose to 7.4 percent in July. The city's unemployment rate was 6.8 percent in June and was 5.9 percent in July 2007. Cuyahoga Falls had an unemployment rate of 6.1 percent in July, up from 5.7 percent in June and 4.7 percent in July 2007.
The August labor rates for Ohio are scheduled to be released Sept. 19, with county and city rates released on Sept. 23.
''With the unemployment rate over 6 percent, it is a clear warning sign that this economy is continuing to soften faster than we thought. It is a real concern,'' said Joel Naroff, president of Naroff Economic Advisors. ''Businesses have decided to hunker down. They are not hiring, and they are paring workers where they can. That is making things pretty tough out there.''
Wachovia Corp., Ford Motor Co., Tyson Foods Inc. and Alcoa Inc. were among the companies announcing job cuts in August. GMAC Financial Services this week said it would lay off 5,000 workers.
Widespread cuts
Job losses in August were widespread, the government report showed.
Factories cut 61,000 jobs, with housing-related manufacturers and automakers among the hardest hit. Construction firms eliminated 8,000 jobs, retailers axed 20,000, professional and business services slashed 53,000 and leisure and hospitality got rid of 4,000. Those losses swamped gains in government, education and health.
Job losses at all private employers — not including government — came to 101,000 in August.
The government said workers age 25 and older accounted for all the increase in unemployment in August.
All told, the number of unemployed rose to 9.4 million in August, compared with 7.1 million a year ago. Economists predict more job losses ahead, pushing the jobless rate to 7 percent by the fall, according to some projections.
Workers saw wage gains in August, however.
Average hourly earning rose to $18.14 in August, a 0.4 percent increase from July. Economists were forecasting a 0.3 percent gain. Over the past year, wages have grown 3.6 percent, but paychecks aren't stretching as far because of high food and energy prices.
Caught between dueling concerns of slow growth and inflation, the Fed is expected to leave a key interest rate alone at 2 percent when it meets next on Sept. 16 and probably through the rest of this year.
WASHINGTON: The nation's unemployment rate zoomed to a five-year high of 6.1 percent in August as employers slashed 84,000 jobs.
Get the full article here.
Comments
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Posted 10:00 AM, 09/06/2008
We haven't hit bottom yet!!!....irreguardless what you may have heard!
akron, oh
Posted 01:02 PM, 09/06/2008
Whats the difference between a recession and a depression... A recession is when your neighbors are out of work. A depression is when you are out of work...
tallmadge, oh
Posted 03:00 PM, 09/06/2008
or your neighbors south of the boarder no longer working the fields and instead are taking once good paying jobs in construction. All on temporary worker visas.
