Ouch, unemployment climbed to a 26 year high in October as as more than 558,000 Americans lost their jobs in October:
In another sign that workers are being left out of the budding economic recovery, the U.S. unemployment rate climbed to 10.2% in October, topping the 10% mark for the first time in 26 years.
Nonfarm payrolls dropped by a seasonally adjusted 190,000 in October, bringing to total number of jobs lost in the recession to 7.3 million, the Labor Department reported Friday. It was the 22nd straight monthly decline in payrolls.
Large losses were seen in manufacturing, construction and retai employment. Health care and temporary-help agencies added jobs. Read the full government report.
The October jobs report shows a growing disconnect between a recovery in economic output and continued job losses. The economy grew at a 3.2% annual rate in the third quarter, with productivity rising at a 9.5% rate.
“The grinding pace of progress in labor markets likely flags a tepid economic recovery,” wrote Sal Guatieri, an economist for BMO Capital Markets.
With unemployment remaining elevated and no sign of job growth, the Federal Reserve could be expected to keep its interest rate target at virtually zero, economists said. Read commentary on the Fed and jobs.
The jobs report was worse than expected. Economists surveyed by MarketWatch were forecasting a rise in the unemployment rate to 10%, with 150,000 lost payroll jobs. An upward revision to August and September payrolls cushioned some of the disappointment, however.
The current 10.2 percent unemployment rate is the highest since April 1993.
According to the Bureau of Labor Statistics 15.7 million Americans are unemployed, of those, 5.6 million, or 35.6% of the unemployed, have been out of work for more than six months… Representing another grim record. When you add in laid-off workers who have settled for part-time work or who have given up looking for work, the unemployment rate is 17.5 percent.
Regular readers know I’m a pessimist about the economy and I don’t see anything in this month’s jobs report to change that… Job losses accelerated in manufacturing, the average losses in the previous four months were 51,000 per month, but in October they climbed to 61,000 jobs lost. Construction improved slightly loosing 62,000 jobs in October, down slightly from the 4-month average of 67,000. Finally, the retail sector lost 40,000 jobs last month – an indication that retailers are anticipating a weak a holiday season.