Unemployment Rate Soars to 8.1% in February
In addition, the Labor Department upwardly revised its December and January job loss figures to 681,000 and 655,000, respectively.
While economists and market watchers had braced for gloomy February data, the report indicates that American workers are riding a continuous wave of job cuts — possibly with little relief in sight.
Since the recession began in December 2007, the U.S. economy has shed almost 4.4 million jobs, more than half occurring the past four months, the AP reported. In sum, the number of unemployed people has climbed to 12.5 million.
Over the past 12 months, the number of unemployed persons has increased by about 5 million, and the unemployment rate has risen by 3.3 percentage points, the Labor Department report said.
In a speech Friday morning in Columbus, Ohio, President Barack Obama noted that the new job numbers bring to “an astounding 4.4 million” the number lost in the current recession.
“Well, that is not a future I accept for the United States of America,” the president said, explaining how his economic recovery aims to shore up such losses.
In a bid to help boost the sagging economy, President Obama is counting on a combination of his $787 billion economic stimulus package, a revamped rescue program for the nation’s troubled banks and a $75 billion effort to stem home foreclosures.
Employers have been working furiously to do less with more in the economic downturn, often trimming worker’s hours, freezing wages and cutting pay to keep operations afloat.
“This report was very eye-opening,” Joel Naroff, president of Naroff Economic Advisers and chief economists at TD Bank, told the Online NewsHour. “While the job losses were at a level that wasn’t surprising, what was disturbing was that the previous two months were revised to show an even larger decline in jobs than had previous been reported.”
Some economists, including Naroff, thought that the unemployment could continue to climb, possibly reaching as high as nine or ten percent.
“It just feels like we’re in the teeth of the recession, and the bite is still very hard,” Stuart Hoffman, chief economist at PNC Financial told the New York Times. “This is economy-wide, industry-wide. It shows the severity and the breadth of the job losses.”
Job losses emerged in nearly every sector of the U.S. economy. Nearly 104,000 construction jobs were cut, factories shed 168,000, retailers cut 40,000 jobs and professional and business services got rid of 180,000 workers, according to the AP.
“I would say that there is nothing in this data that says that job losses are over. We will have to look at the weekly numbers, which have not been good, to get a better sense. But the job losses are very broad, hitting almost every sector,” said David Hale, a Chicago-based economist and founder of Hale Advisers.
Education, health services and the government were among the few sectors to actually gain employment in February.
Fed Chairman Ben Bernanke told Congress earlier this week that recent economic indicators “show little sign of improvement” and suggest that “labor market conditions may have worsened further in recent weeks.”
“I think if there is one thing about this report that may have a small silver lining,” Naroff added, “is the hope that what we are seeing is businesses cut their workforce as rapidly as they can and as deeply as they dare in order to get their business in shape to ride out the storm. We might not see a second or third round of cuts and by late spring or summer it is possible that the job cuts will slow.”