US government jobs reports due later today are expected to show that employers cut the most jobs in at least 34 years last month as the global economic crisis gathered pace and moves by policy makers took time to filter through to struggling companies.
The reports will provide the latest grim assessment of a global financial crisis that has sparked a wave of policy measures from countries worldwide, the latest being interest rates cuts by South Korea and Britain.
US President-elect Barack Obama warned the US economy could stay mired in recession for years without further bold action, though he gave few new details about a package of tax cuts and public-works spending now likely to cost $800 billion or more.
"I don't believe it's too late to change course, but it will be if we don't take dramatic action as soon as possible," Obama said in a speech on the economy at George Mason University in Fairfax, Virginia yesterday.
"If nothing is done, this recession could linger for years. The unemployment rate could reach double digits."
Underlining Obama's fears, the US non-farm payrolls report for December, due later today, is expected to show that 2008 produced the biggest job losses since demobilization following World War Two.
For December alone, job cuts are expected to amount to 550,000, the most for a single month in 34 years, taking the unemployment rate to 7 per cent.
Indeed, a report earlier this week showing December job losses in the private sector of close to 700,000 raised fears the more comprehensive government report would be worse that expected.
Financial markets were on hold ahead of the key jobs data, with Asian shares easing slightly and government bonds ticking higher as investors anticipated a weak jobs number.
Reuters