8.5 Percent Jobless Rate, Highest Since 1983
RENEE MONTAGNE, host:
Here in the U.S., the Labor Department said this morning that the nation's unemployment rate climbed to eight and a half percent last month. That's its highest level since 1983, and it's one more sign of the toll that the recession is taking on the U.S. economy. NPR's Jim Zarroli is covering this story and joins us now. Good morning.
JIM ZARROLI: Good morning.
MONTAGNE: How widespread were the job cuts and break it down for us a little bit where they were.
ZAROLLI: Well, here are some numbers. The economy lost 663,000 more jobs. It's the fourth month in a row we've seen that number go over 600,000. The Labor Department also revised the number for January. It said 741,000 jobs were lost in that month, which was more than the first estimate. And it was also the biggest decline in nearly 60 years for a single month.
I spoke with Richard Yamarone who's the chief economist at Argus Research a little while ago. Here's what he had to say about the report.
Mr. RICHARD YAMARONE (Chief Economist, Argus Research): It is such a steep decline in activity. The economy is just shedding jobs in an accelerated pace. So this is - it's really disheartening. It's not encouraging news, certainly, as we head into the summer months.
ZAROLLI: Yamarone says one of the things you're starting to see are big loses tied to the decline of the auto industry. The manufacturing sector was down 160,000 jobs. The retail sector eliminated 50,000 jobs. And, of course, part of that is car dealerships laying people off.
They always talk about this long, the long tentacles that the auto industry has throughout the economy and here's some evidence of that. But, really, every part of the economy eliminated jobs - except for education and health care.
MONTAGNE: Adding in these new numbers that we're getting this morning, how many jobs has this recession now cost the economy?
ZAROLLI: Well, the recession began in December 2007, so it's, I guess, 16 months long. It's already a long time for a recession and this one doesn't show any signs of letting up. In that time, the economy has lost 5,100,000 jobs. And the really disturbing thing is how that has accelerated over time, because two-thirds of the losses have come just in the last six months. A lot of employers began cutting jobs last fall and they're still doing so.
And here's another statistic. We now have a total of 13,200,000 unemployed people, and that doesn't even include the people who are working part time because they can't find full-time jobs, and also doesn't include all the people who have become so discouraged that they simply stop looking for work. They've walked away from the job market.
MONTAGNE: So, what light does that show, those numbers you've just given, on the ways in which employers are adjusting to the downturn?
ZAROLLI: In a way, the length of the average work-week fell to a record low of; I think it's a bit more than 33 hours. One of the things we're seeing is that companies are cutting hours rather than laying them off altogether, you know, looking for ways to avoid layoffs.
We've seen some little glimmers of hope in the economy lately, some signs that the downturn is bottoming out - like better than expected factory orders report yesterday. But, really, what this says is that companies at least are still very pessimistic about the economy. They're feeling pinched and they're not going to start hiring again until they feel confident, which is why most economists say we're really not going to see the economy turn around until next year. And meanwhile, the unemployment rate could get to 10 percent.
MONTAGNE: Thank you, Jim.
ZAROLLI: You're welcome.
MONTAGNE: NPR's Jim Zarolli on news today that unemployment has jumped to eight and a half percent.