WASHINGTON - Employers shed a worse-than-expected 533,000 jobs in November, the Labor Department reported Friday, the biggest monthly jobless number in 34 years and indisputable evidence that the U.S. recession is worsening.
Adding insult to injury, the Bureau of Labor Statistics revised upwards its previous jobless reports, noting employers in October actually sent 320,000 workers packing instead of the 240,000 first reported. And September job losses were actually 403,000 and not the 284,000 stated in that month's report.
November's numbers were the worst since December 1974, when employers lopped off 602,000 positions in response to tightening credit and government price controls designed to quash inflation.
In a separate report Friday, the government said the nation's unemployment rate ticked up to 6.7 percent in November, from 6.5 percent the prior month. This was slightly better than consensus expectations but reflected a large number of people no longer looking for work and thus out of the workforce. Still, the unemployment rate is now the highest in 15 years.
Taken with weak holiday sales numbers, slowing exports and the worst financial crisis since the Great Depression, it's clear the U.S. economy is in deepening trouble.
Friday's dreadful jobs report is sure to give new urgency to efforts in Congress to forge a large economic stimulus package before or immediately after President-elect Barack Obama's inauguration.
Obama issued a statement soon after the brutal numbers were made public, noting "it's likely to get worse before it gets better" and that government must move on stimulus efforts.
"Our economy has already lost nearly 2 million jobs during this recession, which is why we need an Economic Recovery Plan that will save or create at least 2.5 million more jobs over two years while we act decisively to maintain the flows of credit on which so many American families and American businesses depend," the president-elect said.
The numbers may also help sway opponents of an auto industry bailout being considered by Congress, since allowing a U.S. carmaker to enter bankruptcy and send shocks across its supply chain would pile on to a dismal economic outlook.
At the start of a Friday hearing on the bailout, House Financial Services Committee Chairman Barney Frank, D-Mass., warned of dire consequences if fellow lawmakers fail to rescue Detroit's Big Three.
"For us to do nothing ... would be a disaster," said Frank.
Friday's job report drove home an important point. Employers in virtually all sectors are now trimming payrolls,
Only government and the health care sector added jobs in November, 7,000 and 34,000 respectively, the BLS report said. The retail sector lost the biggest number of jobs at 91,000. Manufacturers shed 85,000 jobs, followed by construction, which lost 82,000 jobs, and the leisure and hospitality, which trimmed 76,000 positions.
"Job declines were widespread with losses in manufacturing, construction and retail, financial and business services. The only bright spots remaining are health care and education," said John Silvia, chief economist for Charlotte, N.C.-based Wachovia, in a note to investors. "Over the last year, the breadth of industries adding jobs has dropped sharply suggesting broad weakness in consumer spending and dismal consumer confidence."
Looking forward, it seems unlikely that recovery is anywhere around the corner. For example, the National Federation of Independent Business, which represents retailers and other small firms, found a grim outlook in its most recent survey of members in late November.
"Over the next three months, 12 percent plan to create new jobs and 10 percent plan workforce reductions yielding a seasonally adjusted net negative 4 percent of owners planning to create new jobs, down 4 points from October and one of the lowest readings in the 35 year history of the NFIB survey," wrote chief economist William Dunkelberg. "This indicates that weak job markets will spill over into 2009."
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