Friday, October 3, 2008
WASHINGTON (Reuters) – U.S. employers cut 159,000 jobs last month, a ninth straight monthly reduction and the deepest in 5-1/2 years, the government said in a report on Friday that suggested the economy may be in recession.
The unemployment rate held at a five-year high of 6.1 percent, as 121,000 people left the workforce, the Labor Department reported.
The bad news on hiring, together with a separate report showing that a sluggish service sector barely grew in September, underlined the weakening pace of U.S. economic activity as a credit crunch continues to deepen.
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“This is one more stark reminder that this is a time for action, a time for bipartisanship,” Commerce Secretary Carlos Gutierrez said in an interview during which he expressed hope the U.S. House of Representatives would vote to approve a rescue package for U.S. financial firms.
“We need that to restore confidence,” he said.
RECOVERY TO BE SLOW
White House spokesman Tony Fratto said the job report was disappointing but not surprising. “Everyone should understand that it will take some time for our economy to recover from the housing correction, elevated energy prices and the credit crisis.”
September’s job losses were much more severe than predicted by Wall Street economists surveyed by Reuters, who had forecast 100,000 jobs would be cut.
This article was posted: Friday, October 3, 2008 at 9:25 am