Unemployment Rates Bad, But There Are Bright Spots

Unemployment Report Bad, But Has Its Bright Spots 3/6/2009 The latest unemployment data reports the U.S. economy lost 651,000 jobs last month, signaling there's still no end in sight to the recession. WSJ's Kelly Evans tells colleague Phil Izzo what to take away from the report and what the bright spots are.

From the WSJ:


WASHINGTON -- The U.S. economy continues to hemorrhage jobs at monthly rates not seen in six decades, a government report showed, signaling that there's still no end in sight to the severe recession that has already cost the U.S. over four million jobs...

Nonfarm payrolls, which are calculated by a survey of companies, fell 651,000 in February, the U.S. Labor Department said Friday, in line with economist expectations. However, December and January were revised to show much steeper declines. In the case of December, the revision was to a drop of 681,000, the most since 1949 when a huge strike affected half a million workers. However, the labor force was smaller then than it is now...

The unemployment rate, which is calculated using a survey of households, jumped 0.5 percentage point to 8.1%, the highest since December 1983 and slightly above expectations for an 8% rate. Some economists think it could hit 10% by the end of next year. For many industries including manufacturing, construction, business services and leisure, the jobless rate is already in double digits...

Ironically, some of the pressure on labor markets appears to be a byproduct of robust productivity, which is actually a big plus for the economy over the long run. But in the current environment, it seems to be making things worse for workers as nimble businesses shed labor in anticipation of falling demand, which could become a self-fulfilling prophesy...

The sole bright spot among private sector industries was health care, which tends to be more labor intensive and less productive than manufacturing and other services. Health care payrolls rose 26,900.

The government added 9,000 jobs.

Economists React: 'Staring Into the Abyss'
Wash Wire: Jobs Data Becomes Political Fodder
Real Time Econ: Broader Rate Hits 14.8%
Video: Data Bad, But Has Its Bright Spots


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