US unemployment soars to 9-year high

The US jobless rate surged to a 9-year high in June as employers cut 30,000 workers from their payrolls, the government said …

The US jobless rate surged to a 9-year high in June as employers cut 30,000 workers from their payrolls, the government said today in an unexpectedly gloomy report on the economy.

But a separate measure of the vast services sector showed it grew far more quickly than expected last month, revving up to its fastest pace since September 2000 and offering hope to some that businesses would soon start hiring.

The jobless rate hit 6.4 per cent - a much worse reading than the 6.2 per cent projected by private economists. It was up three-tenths of a percentage point from May's 6.1 per cent, to a level not reached since April 1994, the Labor Department said.

June marked the fifth straight month of job losses. Economists had expected payrolls to stay steady in June, rather than fall. The government revised May's payrolls to show a 70,000 drop instead of the earlier reported 17,000 decrease.

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Adding to the picture of a bleak job market, the Labour Department said new claims for unemployment benefits rose last week to 430,000 from 409,000 in the prior week. Claims had been expected to rise to only 410,000.