Official figures show October was the 22nd consecutive month of job cuts Wall Street is set for a turbulent day as US jobless figures were higher than expected. Photograph: Justin Lane/EPA The US unemployment rate has broken through 10% for the first time since the early 1980s in a fresh sign of financial misery at grassroots level in the world's biggest economy. Monthly figures from the US department of labour revealed that employers cut a higher-than-expected 190,000 jobs in October. The unemployment rate rose to 10.2% from September's 9.8%, reaching its highest level since April 1983. Wall Street forecasters had expected job losses of closer to 175,000 and were hoping that the percentage rate of unemployment would remain in single figures. The data came out before the opening of the financial markets in New York but stocks in Europe immediately weakened. Nigel Gault, chief US economist at IHS Global Insight, described the unemployment rate as a "horrible number". "People were hoping there would maybe an upside surprise to this," said Gault. "What's happened is it's come out worse, so that's caught them on the wrong foot. They were leaning one way, and it's gone the other. Remember, we had a huge run-up in the market yesterday, a lot of optimism. So this throws a bit of cold water on that." David Resler, senior economist at Nomura Securities in New York, described the double-digit jobless rate as "really quite disheartening" and said he did not foresee any move by the Federal Reserve to raise interest rates for some time: "We don't see the Fed doing anything before the early part of 2011, and this simply reinforces that point." October was the 22nd consecutive month of job cuts in the US economy. The ongoing loss of employment comes despite a $775bn (£468bn) economic stimulus package enacted by president Barack Obama in an attempt to kick-start activity, including the creation of work through "shovel ready" public projects across America. Among the worst-hit sectors were construction, where employers cut 62,000 jobs in October, and manufacturing, where 61,000 positions disappeared. Retail lost 40,000 jobs and in the leisure industry, payrolls were reduced by 37,000. But education, health and professional services showed an increase in employment. Economists generally view unemployment as a lagging indicator that tends to be one of the last factors to improve as a recession comes to an end.US jobless rate hits 10%
Friday, 6 November 2009
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