Finance Globe

U.S. financial and economic topics from several finance writers.
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Unemployment Rate for December Hits 16 Year High

The government reported today that U.S. economy lost 524,000 jobs in the month of December, bringing the unemployment rate up to 7.2% from November's 6.8% unemployment rate. This is the highest unemployment rate in sixteen years.

Over just the last four months of 2008, almost 2 million jobs have been lost. The job losses were spread far and wide across most industries and over 11 million Americans are now out of work.

Since the start of the recession in December 2007, 3.6 million workers have become unemployed and the unemployment rate has risen by 2.3%.

The number of long-term unemployed, those who've been unemployed for 27 weeks or more, rose to 2.6 million. On November 21, 2008, President Bush signed into law an expansion on the Emergency Unemployment Compensation package to extend benefits for America's long-term unemployed workers.

Also, the number of people who worked part-time for economic reasons increased by 3.4 million over the past 12 months. 8 million workers are in this category, including those who would rather work full-time but could not find full-time positions.

Almost 2 million Americans also wanted to find work, but did not count towards the official unemployment rate because they didn't search for work in the four week period immediately preceding the government' survey. This group includes 642,000 people who have looked for work in the past year, but became discouraged because they didn't believe there were any jobs out there for them. The other 1.3 million in the group didn't looked for work in the preceding four weeks due to school or family commitments.

Manufacturing jobs lost 149,000 positions in December for the largest over-the-month decline since August 2001. Factory jobs have lost 791,000 positions in 2008. The construction industry lost 101,000 jobs for December and 899,000 job since peaking in September 2006.

Professional and business services positions within the temporary help industry lost 81,000 jobs in December, for a total of 490,000 jobs lost for 2008. A large number of retail jobs were also lost, 67,000 in December for a total of 522,000 in 2008.

Most other industries also lost jobs. The health care industry remains one of the few that added jobs - 32,000 jobs in December, for a total of 372,000 positions in all of 2008.

For those who are employed in production and non-supervisory positions, the average workweek dropped slightly in December to 33.3 hours - the lowest level on record since 1964.

Average hourly earnings this group rose by .3% in December. For all of 2008, the average hourly earnings increased by 3.7% and the average weekly earnings increased by 2.2%.

The pain in the job market is likely to continue for some time. The Congressional Budget Office reported earlier this week that they expect the unemployment rate to continue to rise and exceed 9% by 2010.

U.S. Secretary of Labor Elaine L. Chao said in response to the December report, "The Department of Labor has many resources to help America's workers cope with the current economic challenges that today's report described. We are working with the states to ensure that the unemployment insurance system has the resources it needs to continue to operate smoothly and pay benefits. Workers looking for help can call 1-877-USA-JOBS, and we encourage workers looking for training or jobs to visit and use the resources available at www.dol.gov."

President-elect Barack Obama hopes to stem the rising unemployment rate with the American Recovery and Reinvestment Plan. Under the proposed plan, Obama says he is confident that 3 million jobs can be saved or created by rebuilding the nation's infrastructure, updating public buildings, investing in alternative energy, and computerizing medical records.

Even when the legislation is passed, it will still take some time to put the plan into action and actually create the jobs. Congress is expected to have a package ready for Mr. Obama to sign by mid-February.



Source:
Department of Labor - Bureau of Labor Statistics
Brace For a Difficult 2009
Obama's American Recovery and Reinvestment Plan
 

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Thursday, 24 October 2019

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