Transcripts

Another Half Million Jobs Lost But Unemployment Is Slowing

SUSIE GHARIB: The nation's unemployment rate is now at its highest level in 25 years, 8.9 percent. American businesses cut 539,000 jobs in April, right in line with forecasts. But there were signs of hope in the dismal report. The pace of layoffs slowed, suggesting to some economists that the worst of the job losses are over. Suzanne Pratt reports.

SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRESPONDENT: It's hard to feel good when the U.S. loses more than half a million jobs in one month. But when it comes to economic statistics, much is relative. And even though employers cut 539,000 jobs in April, there's no denying the pace of layoffs is slowing. It looks like the deepest job cuts of the recession came in the first three months of this year, two of which were revised downward today. While economist Brian Fabbri believes the worst of the bad months for job losses is over, he says it's too soon for Americans to feel secure about employment.

BRIAN FABBRI, CHIEF ECONOMIST, BNP PARIBAS: We're looking at six million jobs lost already in this recession. I think we'll probably get to eight and we're still not out of the woods in terms of the labor market conditions.

PRATT: Part of the problem is the labor market lags the overall economy. So, even if we are seeing those much-talked about green shoots of a recovery, it could be next year when the economy finally stops losing jobs. Other economists warn investors not to get too jazzed about the April employment report. Yes, employers cut the fewest jobs last month since October, but the jobs lost were still widespread, coming in construction, manufacturing, retail and financial services. And even though the Federal government added 72,000 positions to payrolls, much of those were census workers.

FABBRI: The 62,000 that were going for the census, when the census is over, when they finally take all of the surveys for the census, those people get fired.

PRATT: And let's not forget the unemployment rate, which spiked up to nearly 9 percent in April. Many economists like Conrad Dequadros believe that number could head higher before topping out next year.

CONRAD DEQUADROS, ECONOMIST, RDQ ECONOMICS: Given the speed with which the unemployment rate has risen, given the extent of the weakness in the economy and I think the likelihood that the recovery is probably going to be quite lackluster, it's my expectation that the unemployment rate may not get to 10 percent, but it's certainly a risk.

PRATT: Most economists agree, when it comes to the job market, things are less bad rather than getting better. But for an economy gripped by the scariest recession in decades, that's one more glimmer of hope. Suzanne Pratt, NIGHTLY BUSINESS REPORT, New York.