U.S. Economy Lost 80,000 Jobs in March
At the same time, the national unemployment rate rose from 4.8 percent to 5.1 percent, the clearest signal yet that the economy might already be shrinking, according to The Associated Press.
Job losses were widespread: construction, manufacturing, retailing, financial services and various business services all saw downturns. That overwhelmed gains in other sectors including education, health care and government.
The new employment data is much weaker than economists predicted. They anticipated a drop of 50,000 payroll jobs and the unemployment rate to rise to 5 percent.
The unemployment rate — while relatively modest by historical standards — was nonetheless the highest since September 2005, when significant job losses followed the Gulf Coast hurricanes.
“The labor market has indeed turned south,” Joel Naroff, president of Naroff Economic Advisors, told the AP. “That was the one last bastion of hope to stay out of a recession. Now the question is how deep and how long will it last?”
The bleak employment figures come on the heels of Federal Reserve chief Ben Bernanke’s testimony to Congress Wednesday that while the current economic downturn might be temporary, “a recession is possible.”
“I’m not yet ready to say whether or not the U.S. economy will face such a situation,” Bernanke told a Senate committee.” However, it’s clearly a period of very slow growth, extending back to the fourth quarter of last year, and we are trying to set our policies appropriately for that situation.”
Some economists, however, were more grim in their assessment of the nation’s economic health.
“Three months in a row of payroll job losses and a sizable negative revision: these are clear signs that the job market is in recession,” Jared Bernstein, an economist at the Economics Policy Institute, told the New York Times. “I’m hard-pressed to imagine anyone who would raise doubt to that at this point.”