US unemployment highest since 1983

UNEMPLOYMENT IN the US has leapt to its highest rate in a quarter of a century as another set of dire official figures showed staff being axed across the economy.

The number of jobs lost reached 651,000 in February, the third consecutive month in which more than 600,000 posts have been shed – a sequence last recorded in 1939. Investors had predicted sharp falls, and there was a muted market reaction to the data.

But downward revisions to job totals for previous months made the overall picture for the US job market look markedly worse.

The unemployment rate in February jumped from 7.6 per cent to 8.1 per cent, its highest level since 1983. The recession has accounted for 4.4 million US jobs and the unemployment rate has almost doubled from 4.4 per cent.

Economists and policymakers were almost unanimous that there were no signs of optimism to be gleaned from the figures.

Christina Romer, chair of the White House council of economic advisers, said: “There’s no way that we could or should put a positive spin on these. The American people are clearly suffering.”

US president Barack Obama said the $787 billion (€622 billion) stimulus Bill would save or create 3.5 million jobs, and the unemployment figures should leave the US public in no doubt that a large fiscal boost was needed to rescue the economy. The unemployment figure means joblessness has reached the average for the whole of 2009 predicted by the White House in its recent budget, a forecast that some private-sector economists and Republicans claimed was too optimistic.

Because movements in the labour market trail the rest of the economy by several quarters, economists said there were more job losses and rising unemployment to come. Peter Hooper, chief economist at Deutsche Bank in New York, said: “We were expecting bad news and we got it.

"This is a very serious recession and there is nothing in the near term to feel particularly good about." – ( Financial Timesservice)