Friday, Jan 9, 2008
The U.S. probably lost 525,000 jobs in December, capping the biggest collapse in employment since the end of World War II, economists said before a report today.
The projected decline, based on the median estimate of 73 economists surveyed by Bloomberg News, would bring last year’s payroll drop to 2.4 million, the most since 1945. The unemployment rate likely jumped to a 15-year high of 7 percent.
The outlook for 2009 is no brighter as retailers from Wal- Mart Stores Inc. to Macy’s Inc. slash profit forecasts and manufacturers including Alcoa Inc. cut output and staff. The figures are likely to intensify pressure on U.S. lawmakers to speed President-elect Barack Obama’s proposed fiscal stimulus through Congress in an effort to save or create 3 million jobs.
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“The labor market is clearly not functioning at all,” said John Silvia, chief economist at Wachovia Corp. in Charlotte, North Carolina. “This will be a big hit to consumer spending and confidence. It suggests a very long, challenging recession.”
The report, the last one under President George W. Bush’s watch, is due from the Labor Department at 8:30 a.m. in Washington. Economists’ estimates for December ranged from job losses of 350,000 to 750,000. Forecasts for the unemployment rate ranged from 6.5 percent to 7.1 percent.
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The projected decline would be the 12th consecutive loss, and follow a 533,000 November decrease that was the largest in three decades. The economy created 1.1 million jobs in 2007.