The jobless rate zoomed to 6.5 percent from 6.1 percent in September, the new figures showed. Last month’s rate matched the reading from March 1994.
October’s decline marked the 10th straight month of payroll reductions, and government numbers showed that job losses in August and September turned out to be higher than initially thought, the Associated Press reported. Employers cut 127,000 positions in August, compared with 73,000 previously reported. A whopping 284,000 jobs were axed in September, compared with the 159,000 jobs first reported
So far in 2008, 1.18 million jobs have been lost, Thompson Financial News reported, adding that to keep up with new workers, businesses will have to create about 100,000 new jobs each month instead of the 90,000 job losses they’ve been averaging per month over the past year.
Auto manufacturer Ford Motor Co. announced Friday plans to cut more than 2,206 jobs, which equates to roughly ten percent of its North American salaried work force. Ford also reported a loss of $129 million in its third quarter.
With thousands of layoffs across the country, first-time applications for unemployment benefits last week were at 481,000, down from 485,000 from the week prior, but still very high.
A Labor Department spokesman said job losses due to damage from the Gulf Coast’s hurricanes this fall were to blame for the initial spike but are no longer having a “significant” influence on claims.
In the manufacturing and services sectors, purchasing-manager surveys over the past week showed losses in October and the Institute of Supply Management’s factory index dropped the most in 26 years. The Institute’s non-manufacturing measure fell to its lowest level since 1997, when records began.
While efforts to shore up failing investments and home foreclosures have begun to make some headway, financial experts expect job losses to continue to fall in 2009. During the 1980-1982 economic recession, the unemployment rate rose to 10.8 percent before improving, the Associated Press reported.
Some economists, however, felt that while conditions may be worsening, the drop in unemployment is not out of line with more mild recessions in recent history.
“The data does not appear out of line with recessionary norms,” Citigroup’s Steven Wieting said, according to the Wall Street Journal. “Thus far, the rise in unemployment insurance claims also appears to be consistent with this worsening, but not beyond recessionary expectations.”
The U.S. stock market Friday morning also appeared optimistic despite job-loss reports. The Dow Jones Industrial Average rose 136 points to 8,831 and the Nasdaq was up 21 points to 1630 in early trading.