159 000 jobs lost in Sept.

Published: Friday October 10, 2008

The United States economy lost 159 000 jobs in September, the worst month of retrenchment in five years, enhancing fears that an already pronounced downturn had entered a more painful stage that could last well into next year.

Employment has diminished for nine consecutive months, resulting in the elimination of 760 000 jobs, according to the Labour Department report released last week. Most of that occurred before the trauma of recent weeks, when a string of prominent Wall Street institutions nearly collapsed, prompting the government to propose a US$700 billion rescue package.

"It's a dismal report and the worst thing about it is that it does not reflect the recent seizure that we've seen in the credit markets," said Michael T. Darda, chief economist at MKM Partners, a research and trading firm in Greenwich, Connecticut. "There's really nothing good about this report at all. We've lost jobs in nearly every area of the economy, and this is going to get worse before it gets better because the credit markets have deteriorated basically on a daily basis for the last few weeks."

For the first eight months of the year, the economy lost an average of about 75 000 jobs each month. September's report more than doubled the damage, heightening the sense that an already weak economy has become even more frail.

Decline

Manufacturing lost 51 000 jobs in September, bringing the decline so far this year to 442 000 and more than four million since 1999. Retailers lost 35 000 jobs in September. The construction sector shed 35 000 jobs. Employment in transportation and warehousing slid by 16 000.

Jobs in financial services dropped by 17 000 in September and have slipped by 172 000 since employment peaked in that part of the economy in December 2006.

And that was before the bankruptcy of the Wall Street titan, Lehman Brothers; the bailout of the mortgage financiers, Fannie Mae and Freddie Mac; the fire sale of Merrill Lynch to Bank of America; the near disintegration of the insurance giant American International Group; and the government takeover and sale of Washington Mutual.

Health care remained a rare bright spot in the economy, adding 17 000 jobs in September. Mining added 8 000.

The unemployment rate remained steady at 6.1 per cent, but economists said this reflected the fact that the official jobless rate does not count people who have given up looking for work. Over the last year, the unemployment rolls have swelled by 2.2 million, to 9.5 million.

Unemployment rose to 11.4 per cent among African-Americans in September, and to 19.1 per cent among teenagers, after the worst summer job market on record.

Over the last year, average weekly wages for some 80 per cent of the American workforce have risen by a meagre 2.8 per cent, with the gains more than reversed by increases in the prices of food and fuel.


Source: Nation Newspapers
http://www.nationnews.com/story/303081912129744.php