- Economic crisis - layoffs - unemployment - USA
US unemployment rate jumps to over 10% in October
The unemployment rate in the United States for October rose to 10.2 %, its highest level in 25 year according to the Department of Labor. The monthly data was worse than expectations, with forecasters expecting a 10% jobless rate.
AFP - The US unemployment rate jumped to 10.2 percent in October as 190,000 jobs were shed, the government said Friday in data highlighting ongoing struggles of an economy emerging from recession.
The Labor Department report, seen as one of the best indicators of economic momentum, showed a rise in the jobless rate, up from 9.8 percent in September, to the highest since 1983. But the number of jobs lost narrowed to the lowest level in over a year.
The jobless rate shot above the key 10 percent barrier for the first time since June 1983, even though the agency revised down the number of job cuts in the prior two months.
"The employment numbers themselves when you look at the revisions weren't all that bad, but the headline of 10 percent was huge psychologically," said Robert MacIntosh, economist at Eaton Vance.
MacIntosh said that if current trends continue, the economy could see job gains in January or February but that unemployment may rise with labor force and population growth.
"This means a slower, more frustrating economic recovery," he said.
Overall, the monthly report was worse than expectations for a 10 percent jobless rate and 175,000 job losses despite the improving trend with the downward revision of job losses in August and September.
Non-farm payrolls fell by 219,000 in September (instead of the prior estimate of 263,000) and by 154,000 in August (revised from 201,000).
The number of unemployed persons increased to 15.7 million. Since the start of the recession in December 2007, the number of unemployed has risen by 8.2 million, and the unemployment rate has grown by 5.3 percentage points, the Labor Department said.
The largest job losses over the month were in construction, manufacturing, and retail trade, the report showed.
The goods-producing sectors shed 129,000 jobs in the month including 61,000 in manufacturing and 62,000 in construction. Services lost 61,000 in the month, with 40,000 in retail.
The report showed modest employment gains in professional and business services of 18,000 and 45,000 jobs added in education. Government employment was flat.
The overall labor force fell by 31,000, suggesting more people stopped looking for jobs.
Aggregate hours worked in the private sector, sometimes seen as a proxy of economic activity, fell by 0.2 percent. But hourly earnings rose 0.3 percent, helped by a rise in overtime work.
The world's largest economy grew at a seasonally adjusted 3.5 percent annual rate in the July-September period
The increase was the first since the second quarter of 2008 and the strongest expansion since the 2007 third quarter, when a US subprime mortgage crisis triggered a global financial crisis that hammered the world economy.
Some economist say that the recovery could be threatened without job growth, which would add to overall incomes and spur spending.