Down and Down We Go

Updated:

It could have been much worse. The rising unemployment rate is worse than expected and 1.5 million jobs lost for the quarter is not going to make anyone very happy. The markets are not going to be pleased that's for sure. Is the stock market going to tank now or wait for all the bad earnings reports? That brings the unemployment rate to 7.2% for December. Ouch!

The U.S. economy lost 524,000 jobs in December, closing out the worst year for job losses since World War II, the Labor Department said Friday.

Nearly 2.6 million jobs were lost in 2008, with 1.9 million destroyed in just the past four months, according to a survey of work places. It's the biggest job loss in any calendar year since 1945, when 2.75 million jobs were lost as the wartime economy was demobilized.

The unemployment rate rose to 7.2%, the highest in 16 years. Unemployment increased by 632,000 to 11.1 million, according to the survey of households. That same survey showed employment falling by 806,000 in December.

In 2008, the unemployment rate rose by 2.3 percentage points and unemployment increased by 3.6 million.

The report was worse than expected, with payrolls in October and November revised lower by a total of 157,000 jobs. November's loss was revised to 584,000.
Economists surveyed by MarketWatch expected payrolls to fall by 500,000 and for the unemployment rate to rise to 7.1%.

Total hours worked in the economy fell 1.1%, with the average workweek falling to the shortest ever.

An alternative measure of unemployment that includes workers too discouraged to look for a job rose to 13.5% from 12.6% in November; it's the highest in the 13 years since those data have been kept.

Here is a little more detail from Huffpo. Sure is looking tough for those of us already looking for a job. Couple these bad numbers with the fact that many of us are 6o or so and it gets really depressing. I am sure glad I have been diligent saving for all these years. Not to keen on burning the money I had planned to use for retirement but there are doubtless a lot of the newly unemployed that had little or no savings and are looking at some very tough times.

Update: Here is a little more.

“Of course the U.S. population is significantly larger today (about 305 million) than in the early ‘80s (about 228 million) when the number of part time workers almost reached 7 million, but the rapid increase in part time workers is pretty stunning.” (Calculated risk)

* Brad DeLong offers some further context for the jobs numbers, observing that “And U-6–unemployed plus discouraged workers plus unable to fond a full-time job–is now at 13.5% of the labor force–and BLS ‘discouraged workers’ are a big undercount of the concept.” With so many able-bodied, working age people not actually working, we’re producing many fewer goods and services than we have the capacity to produce. (MY)