Job loss November, most jobs cut since 1974, jobs 1974

Historic November Job Loss Is Newest Evidence of Crippled Economy

December 05, 2008 12:18 PM
by Josh Katz
Employers laid off more employees in November than any month since Dec. 1974, revealing the extent of the economy’s illness.
The Bureau of Labor Statistics indicated today that the jobless rate jumped to 6.7 percent in November, as employers cut 533,000 jobs. It marked the 11th month in a row that jobs were lost and represents the worst numbers since Dec. 1974.

“These numbers are shocking,” said economist Joel Naroff, president of Naroff Economics Advisors, according to the Associated Press. “Companies are sharply reacting to the economy's problems and slashing costs. They are not trying to ride it out.”
Economists had predicted that only 320,000 jobs would be lost for the month. They were expecting a higher unemployment rate, though, of 6.8 percent. The AP explains the discrepancy: “The unemployment rate would have moved even higher if not for the exodus of 422,000 people from the work force. Economists thought many of those people probably abandoned their job searches out of sheer frustration.”

The service sector accounted for 70 percent of the lost jobs in November, “particularly in retailing, temporary work and hotel and restaurant employment,” according to The New York Times. Health care and education were the only two sectors that hired more employees for the month. Since January, the economy has shed more than 1.9 million jobs in total.

Mark Zandi, chief economist at Moody’s, told The New York Times that “Businesses are in survival mode and are slashing jobs and investment to conserve cash. Unless credit starts flowing again soon, big job losses will continue well into next year.”

The news comes as auto executives appear before Congress to request bailout money, and it heightens the chances that President-elect Barack Obama will implement a $500 billion economic package by the end of January.

On Dec. 1, the National Bureau of Economic Research declared that the United States has officially been in a recession since December of 2007, findingDulcinea reported. In a statement, the nongovernmental research group said, “The committee believes that domestic production and employment are the primary conceptual measures of economic activity.”

The recession has now spanned 12 months, exceeding the “the 10-month average length of recessions since World War II,” the AP writes. The longest recessions since the war occurred in the 1973–75 and 1981–82 economic slumps, both of which lasted 16 months. Analysts say the current recession could hit that number or pass it.

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