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Unemployment Jumps to 9.7%, Rate of Job Losses Slows
Signaling that the U.S. job market is still in a fragile state, the Labor Department reported that the unemployment rate jumped to 9.7% in August, a 26-year high, from 9.4% in July. Employers slashed 216,000 jobs last month, which was the smallest decline in a year. Since the recession began in December 2007, 6.9 million jobs have been lost. Since consumer spending accounts for about two-thirds of the U.S. economy, persistently high unemployment will likely mean a slow recovery from the recession, which has eased considerably from earlier in the year. The one bright spot in the report was that the pace of layoffs was easing from early this year (more than 700,000 jobs were lost in January). The rise in the jobless rate in August was partly because more workers renewed their search for employment. That boosted the size of the overall civilian labor force, which usually happens as a recession winds down and optimism about finding work grows. Factories cut 63,000 jobs in August, payrolls in construction industries dropped 65,000, retailers cut 9,600 jobs, the financial sector eliminated 28,000 jobs and professional and business services dropped 22,000. Education and health services increased payrolls by 52,000 in August and government employment fell 18,000 after slipping 28,000 in July.
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Date Last Updated: 09/09/2009
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