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Unemployment in U.S. Increases to 8.5%, 25-Year High
By Bob Willis
April 3 (Bloomberg) -- The U.S. unemployment rate climbed in March to the highest level since 1983 and the economy lost more than 650,000 jobs for a fourth consecutive month, a sign renewed reductions in spending might slow a recovery.
The jobless rate increased to 8.5 percent, as forecast, from 8.1 percent in February, the Labor Department said today in Washington. Employers cut 663,000 workers from staff, bringing total losses since the recession began to about 5.1 million, the biggest slump in the postwar era.
Evaporating jobs and declining pay mean President Barack Obama’s pledge to create or save 3.5 million jobs through tax cuts and government spending may fall short of what’s needed to revive the world’s largest economy. Federal Reserve Chairman Ben S. Bernanke has conceded joblessness could top 10 percent under a worst-case scenario.
“The labor market has gotten worse,” Conrad DeQuadros, senior economist at RDQ Economics LLC in New York, said before the report. “Weak labor-market conditions will result in consumer spending being weak throughout most of 2009.”
After the report, stock futures extended gains and the yield on 10-year Treasury notes rose.
The job cuts have been spreading from manufacturers such as Johnson Controls Inc. and Dana Holding Corp. to service providers like International Business Machines Corp. and even the U.S. Postal Service.
Revisions subtracted 86,000 workers from January payrolls while’s February’s drop of 651,000 was not revised.
November 1983
The last time the unemployment rate was at 8.5 percent was in November 1983, when the economy was recovering from the 1981- 82 recession that pushed the rate to almost 11 percent. Then Fed Chairman Paul Volcker boosted interest rates to quell soaring inflation following the 1970s fuel crisis.
Payrolls were forecast to drop by 660,000, according to the median of 80 economists surveyed by Bloomberg News. Estimates ranged from losses of 525,000 to 750,000. . . .
http://www.bloomberg.com/apps/news?pid=20601087&sid=aG_Qy7Fq15hg&refer=home
Trivia: Off the top of your head, do you remember who was President in 1983?
I'm not sure the magnitude of 8.5 percent has been demonstrated yet, but it seems to me that - given an enormous increase in population since '83 - there are all kinds of mitigating factors as to whether this "recession" will or won't be as seriously felt. I have a feeling we're better off overall than we were back in 83. I think it's an utterly different world.
By Bob Willis
April 3 (Bloomberg) -- The U.S. unemployment rate climbed in March to the highest level since 1983 and the economy lost more than 650,000 jobs for a fourth consecutive month, a sign renewed reductions in spending might slow a recovery.
The jobless rate increased to 8.5 percent, as forecast, from 8.1 percent in February, the Labor Department said today in Washington. Employers cut 663,000 workers from staff, bringing total losses since the recession began to about 5.1 million, the biggest slump in the postwar era.
Evaporating jobs and declining pay mean President Barack Obama’s pledge to create or save 3.5 million jobs through tax cuts and government spending may fall short of what’s needed to revive the world’s largest economy. Federal Reserve Chairman Ben S. Bernanke has conceded joblessness could top 10 percent under a worst-case scenario.
“The labor market has gotten worse,” Conrad DeQuadros, senior economist at RDQ Economics LLC in New York, said before the report. “Weak labor-market conditions will result in consumer spending being weak throughout most of 2009.”
After the report, stock futures extended gains and the yield on 10-year Treasury notes rose.
The job cuts have been spreading from manufacturers such as Johnson Controls Inc. and Dana Holding Corp. to service providers like International Business Machines Corp. and even the U.S. Postal Service.
Revisions subtracted 86,000 workers from January payrolls while’s February’s drop of 651,000 was not revised.
November 1983
The last time the unemployment rate was at 8.5 percent was in November 1983, when the economy was recovering from the 1981- 82 recession that pushed the rate to almost 11 percent. Then Fed Chairman Paul Volcker boosted interest rates to quell soaring inflation following the 1970s fuel crisis.
Payrolls were forecast to drop by 660,000, according to the median of 80 economists surveyed by Bloomberg News. Estimates ranged from losses of 525,000 to 750,000. . . .
http://www.bloomberg.com/apps/news?pid=20601087&sid=aG_Qy7Fq15hg&refer=home
Trivia: Off the top of your head, do you remember who was President in 1983?
I'm not sure the magnitude of 8.5 percent has been demonstrated yet, but it seems to me that - given an enormous increase in population since '83 - there are all kinds of mitigating factors as to whether this "recession" will or won't be as seriously felt. I have a feeling we're better off overall than we were back in 83. I think it's an utterly different world.